Setting up, or even just updating, your estate plan will never be first on your to-do list when coming home with a new child. There are far too many things to do and there is never enough time to do them. Whenever you get a moment of downtime, you're likely going to want to spend it catching up on sleep and not thinking about the doom and gloom scenarios that make estate planning necessary for your family. The good news is estate planning does not have to be a difficult process and with a small investment of time and money you can have an estate plan that gives you peace of mind.
Contrary to common belief, estate planning is not only for the old and wealthy. Young families should also have estate plans for several reasons. First, even if you don't have a great deal of assets, you probably still have property that you want to be handled a certain way. Second, you will want to identify who takes care of your minor children or pets upon your death or incapacity. Third, you should identify who will be making financial and medical decisions for you if you become unable to take care of yourself.
If a person passes without a properly executed will, his or her property passes according to a default set of rules called intestacy. While intestacy laws provide a default distribution with the goal of distributing property the way a typical person would want, this default will not always be ideal. Intestacy statutes will generally pass the decedent's property to the closest relatives such as a spouse, children, parents, siblings, or even cousins. With these rules in place, executing a will is increasingly important for those who are not married to their partners.
If you have minor children, you can use your will to express your wishes regarding who should care for them. It is important to point out that a Will determines the distribution of property and not people. However, a court will take a parent’s wishes expressed in the Will into account and often will defer to those wishes.
Another contingency you should plan for is the possibility that you will be unable to manage your financial and healthcare decisions. A complete estate plan will include a designation of someone who will manage your finances through a financial Power of Attorney. This designation can be important for families if you happen to have any separate accounts from your spouse or partner. Executing a Power of Attorney will give your partner access to funds that could potentially be needed for family expenses such as housing. The other component of incapacity planning is an Advance Healthcare Directive. This is a document that names the person you designate to make your health care decisions. Additionally, the directive will have information about other healthcare wishes such as when to stop life sustaining treatment, how to manage pain, and whether or not you wish to be an organ donor.
Estate planning is never going to be anyone's idea of a good time and there is never a good time to think about death or incapacity. This is especially true when you have young family. However, with an attorney to walk you through the process, setting your estate plan won't be as difficult as it may seem.