You're young, and you know that you likely have a long life ahead of you. The same is true for your spouse. Despite this, you think it's probably a good idea to create an estate plan.
What can an estate plan do for you now? It can help you protect your children in the case that you or your spouse die unexpectedly. Since your children depend on you, an estate plan is essential. Here are three reasons to create one soon.
1. You can appoint a guardian for your children
Not keen on your sister taking on the role of a parent if you pass away? Maybe you'd prefer a grandparent or other party care for your children. Whatever the reason, if you would like to choose who receives guardianship of your children in the event of your deaths, you need to appoint someone. This person, or another appointed individual, may also receive your children's inheritances until they're old enough to use them as intended.
2. You can choose who's in charge of your assets
The person who becomes your executor or trustee has a responsibility to follow any instructions you leave them to do with your estate. If you leave instructions for how your assets are to be distributed, the executor needs to follow those instructions. Whom you choose does matter. It's a good idea to select someone willing to follow out your wishes who has enough time to commit to the job in a worst-case scenario.
3. It gives you time to plan for insurance and disability
Sometimes, an estate plan isn't just about what happens if you die. There are times when you or your spouse could become disabled or be unable to care for your children. Plan for these possibilities by selecting someone to have medical power of attorney. This person has the power to make medical decisions on your behalf if you're unable to. For example, a daughter may have medical power of attorney for her father, and if there is a question of what he'd want, it's up to her to communicate his wishes.
At the same time that you plan for disability, you can also review the need for life insurance and disability income insurance, which can help if you're unable to work or pass away unexpectedly.
These are a few reasons to create an estate plan. With the right plan, you can protect your children and assets.