When you have people who are dependent on you, like children or elderly parents, you want to ensure that they will be well taken care of in the event you can no longer care for them. Here are five tips for creating an estate plan that will ensure your dependents are taken care of according to your wishes.
- Hire an estate planner ─ An estate planner will make sure that you think of and lay out every aspect of your estate plan. Estate planners stay up to date on tax rules and other laws and regulations, so they can help you ensure that your plan is legally and financially sound, leaving your dependents in the best situation possible.
- Choose a guardian ─ Choosing someone to take care of your children in the event that both you and the children’s second parent are deceased is a huge decision to make and deserves great care and time. You want to choose a guardian who loves your children and has the capacity to take care of them into their adulthood. That means a guardian who has the financial capacity to care for your dependents as well as the physical capacity to do so. So even though grandparents may be able to love and care for your children just as you did, they may not be in good enough health to care for a child or children. On the other hand, your sister may be able to love your dependents just as much as you did and be in perfect health, but is unable to hold a steady job or stay in a committed relationship. The goal of choosing a guardian is to make sure your children are loved and taken care of adequately, that they receive a good education, their lives remain as stable as possible, and they receive emotional support to cope with your loss. It’s crucial to communicate with your chosen guardian. Ask early (and often) if they are comfortable being the guardian of your child or children.
- Develop a trust ─ A trust is often used when people have minor children or dependents that are incapable of taking care of themselves. You, the trustor, puts a trustee in charge of the beneficiary’s property and/or assets until the beneficiary meets certain requirements such as reaching a certain age or milestone. Usually the named guardian is also the trustee, however, every situation is different. Just like choosing a guardian, make sure you take time in choosing a trustee and select someone who is trustworthy and capable.
- Start as soon as possible ─ As soon as you have a child or otherwise become responsible for a dependent, it is important to get an estate plan in place to protect them in case of emergency.
- Reevaluate often ─ As time goes on, your situation may change quite a bit from your original plan. For example, anytime you acquire a new asset or debt, it should be included in your estate plan. Also, you may realize that the guardian you originally chose for your dependent is no longer the right choice. You may have more children or unexpectedly start caring for an elderly family member. Anytime major changes happen in your life that impact what you would leave behind and to whom you’d want to leave it, you should revisit your estate plan.
We all want the people we leave behind to be cared for after out deaths as we cared for tem during our lives. You may have no control over when or how you will die, but you do have control over what happens to your dependents. To get started with your estate plan, please call.