Creating an estate plan can effectively provide security for your loved ones’ future. However, your goals and priorities will likely change over time, especially when expecting a new baby. As such, every three years or any time there’s a birth in your family, it’s important to review any estate planning documents and make the necessary adjustments. Here are a few key elements to address when updating the plan.
How to Update Your Estate Plan When Having Another Child
1. Asset Distribution
Whether you’ve written a will or set up a trust to pass on your assets, an amendment may be required to add your newborn as an heir. This will allow you to make sure the property is distributed among each child exactly how you wish. With a trust, you can also set the terms that determine how the funds are allocated to each heir, such as requiring them to reach a certain age or use the inheritance for college.
2. Guardianship Appointment
For parents of minors, appointing guardianship is a crucial part of estate planning. Naming a guardian in the will ensures you get to decide who raises the kids if both parents pass away. This includes both short and long term guardians.
Even if you’ve chosen a guardian for your other children, you must specify the selection for the new baby. Neglecting to do so will leave the decision up to the court, and could result in someone being appointed you would not have chosen.
3. Beneficiary Designations
Life insurance policies, retirement plans, and other accounts requiring beneficiary designations may need to be revised to include the new baby, such as establishing a new 529 College Plan. If you plan to pass these assets on to all your children, the forms should identify each one as an intended beneficiary. Without making the proper changes, your newest addition won’t receive any benefits and could be left out.
4. Powers of Attorney
If both parents are unable to take care of their children’s needs, it’s important to have someone who can step in and manage the family’s affairs. Setting up powers of attorney will give a person you trust the authority to make medical and financial decisions on behalf of your children while you recover from injury or illness. When you have another child, the documents must be revised to provide the agent with power of attorney for them, as well.
If it’s time to reevaluate your estate planning needs after having another child, turn to Zellar & Zellar Attorneys At Law Inc. in Zanesville, OH. In practice since 1965, this law firm has helped countless families across Central and Southeastern Ohio establish a comprehensive and legally compliant estate plan tailored to each unique situation. They'll advise you on the best decisions for your growing family. Call (614) 257-1643 to schedule a consultation, or visit them online to learn more about their services.
This article is intended to provide general information and should not be construed as legal advice or in creating an attorney-client relationship.
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