You may have known that you always wanted to have a child of your own. When you felt that the time was finally right, you and your spouse likely discussed the idea at length to determine what preparations you needed to make for welcoming a child. By the time your child was born, you felt more than prepared for providing a caring and nurturing home.
Even though you make sure your child knows that he or she is loved and ensure that your baby’s needs are met, you may still have some planning to do. While learning how to care for your child was likely a priority for you, you may also need to prepare for the possibility that you will not be able to provide that care, which is where estate planning comes in.
Why create an estate plan?
You do not have to look at an estate plan as something depressing. It can act as a gift to your child. By making preparations for his or her care in the event that you and the other parent cannot provide it, you ensure that your baby’s future will not suffer unnecessarily despite your passing. Some ways that you can create a plan that will benefit your child include the following:
- Create a will: Your will is the document in which you will name the person or people you want to act as guardians for your child.
- Create a trust: Though you may plan to leave your belongings to your child, a minor cannot directly inherit assets. By creating a trust, the assets can go into the trust, and a responsible party can manage them until your child reaches adulthood.
- Buy life insurance: Funds from a life insurance policy can ensure that your child’s new guardians do not face unnecessary financial struggles as they adapt to caring for your child.
Though it can seem disheartening to think about not being able to care for your child yourself, it is important to consider the benefits of having these plans in place. If you wonder how else your estate plan could act as a gift to your child, you may want to discuss your planning options with a New Jersey attorney. Fully understanding the benefits of an estate plan may make it easier to get started.