Below is an excerpt from Chad Smith, CFP® who wrote about his own estate planning experience as someone in their 30’s:
Our conversations started with the simple goal of establishing a guardian for our children to assure our assets could be used most efficiently.
We had a will and jointly owned all things that were not retirement accounts with beneficiaries.
We also had an understanding of our desires for how we’d like things to go after the first one of us passed.
But since our first daughter was born, we had not updated our estate documents with who we’d prefer as a guardian.
Emergency decisions had been made and an oral agreement was in place. The kind where just before going on your first plane trip after the baby is born, you call and let the person you’ve picked know that if anything happens, they’re responsible going forward.
Since that rushed call, our estate plan had stayed partially complete, falling behind the rest of life’s to-do list.
3 Tips to Consider When Picking A Guardian
- Some of the toughest questions clients have wrestled with arise when family does not live close to the couple. Along with the loss of their parents, the children would be moved and have to make new friendships.
- Many young couples default choice are either the husbands or wives parents as successor guardians. However, the age, health and mobility of the parents should be considered before selecting them. While they love being grandparents, they may not be able to physically handle young children (particularly babies).
- In the event, you are not picking a family member, make sure to get approval from the person/couple before adding them as a guardian. But as time passes, your opinions may change. This New York Times article had some good questions surrounding what happens when you’ve selected a couple as a guardian prior to them having children. Your opinion can change after you see how different their philosophies of raising kids are from your own. This could create an awkward conversation down the road.
Cheap Life Insurance
It pays to obtain more life insurance while healthy if you plan to start a family. Having more little mouths to feed, means you’ll also want to protect them if you are no longer around. The best time to do this is while you’re still young. For example, a healthy 35 year old, would pay 80% more in premiums for a term life insurance policy if waiting to purchase until 45. By seeking an independent opinion on your specific need for life insurance, you could save you big bucks and leave loved ones better protected.
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*As financial planners we do not create estate planning documents as these legal documents should be handled by an estate planning attorney. Our job is to provide education to our clients around estate planning issues and provide a recommendation on ways to align their finances with their estate planning goals and work with their estate planning attorney where necessary.
