The excitement of having a baby often eclipses all other aspects of life in South Carolina, especially for new parents having their first. However, once the baby has arrived home and everyone has settled into their new life, you should begin the state planning process. Whether the child is your own or one you have adopted, you need to prepare for the unexpected.
Why you should start estate planning now
You may think that because you have few assets, estate planning isn’t necessary, but who would take care of your child if you and the other parent become incapacitated? Essential documents like designating a proper health care proxy and executing a power of attorney so someone can access funds to take care of your offspring will solve that problem. Along with those documents, naming a guardian and a trustee to cover continuing care if both parents pass away is also essential. A guardian takes care of your child’s daily needs while a trustee manages financial matters. The guardian and trustee can be the same person, but whatever you decide, choose carefully. You can always name different people later on if your situation changes.
Establishing post-mortem documents such as trusts that will take care of your child’s needs is something that you should also consider while ensuring that the surviving parent has access to the money. Make sure you also have sufficient life insurance benefits, especially if you have few assets.
Determining what your estate should have
Estate planning is a process, so once your child is born, you should start the process once you have your first child and modify it if you have additional children. If you are not sure what you should include, consulting an estate planning checklist can help. Asset preservation is another aspect you should consider.
Parents are sometimes reluctant to start this process as they don’t want to think of their own demise. Others may not want to designate guardians and trustees, believing these documents are permanent. Remember that you can, and should, review estate documents periodically to ensure they fit your needs.