The beginning of a new year is a natural time to look out and think about what the future has in store for you and your family. For those with young or newborn children, the immediate future may include lack of sleep, warming bottles, plenty of diaper changes, and little time for much else; but the long-term future needs a little attending to as well.
Here is a fact that might shock new parents. The U.S. Department of Agriculture estimates that the average cost of raising a child through age 17 is just slightly over $220,000. If college is in the future for your son or daughter, the expenses are going to increase dramatically. It may seem scary, but what it demonstrates is that financial and estate planning is not something that can wait.
When some people think about estate planning, they think of their grandparents or people getting ready for retirement. However, estate planning is for everybody. If you are a new parent, there are a number of estate planning issues you should be looking into. Here are just a few things you should be considering:
A will: Your will is not just a document that you use to give away your possessions. It is a document you can use to designate a guardian who can take care of your children and manage their finances.
A living trust: In addition to a will, you may want to create a living trust to avoid the probate process and better control how your assets are distributed.
Life insurance: As a new parent, you have to remember that you need to do your best to provide for your child. If some unforeseen accident should occur, insurance may be the only way to provide your child with enough money to go to college or pay other necessary expenses.
These are just a few of the many things you can do to begin planning for a secure financial future. If you are considering an estate plan, talk with an estate planning attorney to make sure you have the security that you and your family deserve.
Source: The Herald, Smart financial moves for new parents, Matthew J. Dover 12/30/10