If you’ve recently had a baby, it’s easy to become swept up in all the emotions that come with being a new parent. When you have a child, it’s a good time to make plans to protect your family’s future.
Below, learn about the importance of a will and trust after you’ve welcomed a new baby to your home.
Wills and Guardianship
In your will, you can name a person to serve as your child’s guardian if you pass away. If you don’t name a guardian in your will, the court appoints someone to take care of your child instead.
When you die, the court also uses your will to distribute your assets according to your wishes. If you would like to give your child certain assets, make your wishes known with a will.
Trusts and Trustees
If a child inherits a significant amount of money in Massachusetts, a court will appoint a conservator who controls the investment and disbursement of funds until the child reaches age 18.
Court-appointed conservatorships end when the child comes of age, though, which means they’ll inherit a substantial sum at a young age. You may want to set up a living trust that designates the money for a specific purpose, such as college or bills when your child moves out on their own as a young adult. With a living trust, you can manage assets while you’re alive and transfer them to your child when you pass away.
Power of Attorney
The importance of a will and trust comes into play if you’re incapacitated and can’t make financial choices on your own. Using a power of attorney document, you can name a person to make those decisions for you. They can sign contracts for care, pay bills, file taxes, and more.
Health Care Proxy
Health care proxies are similar to power of attorney legal documents. With one, you can name someone to make medical decisions if you can’t speak for yourself. Without a health care proxy, the court might make choices about your care that you wouldn’t have agreed with.
Life insurance pays benefits to your dependents if you or your spouse passes away. Many employers provide life insurance, but you may find that this amount isn’t enough for your needs.
When buying life insurance, consider the minimum amount your family would need to survive if you passed away. If you’re a primary caregiver, you may need to have enough money to hire a nanny for your child until they’re older.
Would you like to include your new baby as a beneficiary on your life insurance policy? You’ll need to set up a trust to do this because many policies don’t allow you to name minors as beneficiaries.
Contact an Experienced Estate Planning Lawyer in Danvers, MA
If you need guidance with the estate planning legal process or want to know more about different types of trusts, call us at Jordan & White at (978) 744-2811 today. We’ll talk with you about the importance of a will and trust and help you make a plan to safeguard your family’s future.