While creating and occasionally reviewing and modifying your estate plan is always a good idea, there are certain circumstances that may arise that make getting your affairs in order an especially good idea. Once you have your first child, for example, it may become particularly important for you to clearly dictate your wishes and plan for what would potentially happen to your child and affairs should something happen to you.
Maybe you have an estate plan already in place, but your needs have since changed now that you are a mother or father. Maybe you have not done much estate planning at all and are ready to start the process. Regardless of where you are in terms of your estate plan, there are some key elements you may advantageous to cover in your plan once you become a parent. So, after you have a child, consider:
Naming or changing your beneficiaries
If you already have an estate plan in place, chances are, you named certain people as your beneficiaries for particular assets. You may, for example, have named someone the beneficiary of your life insurance policies or retirement accounts, but your needs may have changed now that you have a child of your own. Conversely, if you do not have beneficiaries in place who would inherit these assets, now is a good time to name them.
Giving someone power of attorney
You may, too, want to give someone power of attorney over your affairs once you become a parent. There are two main types of powers of attorney. The first is a medical power of attorney, which gives someone the authority to make decisions relating to your medical care. The second is a durable power of attorney, which gives someone the power to manage your financial and similar affairs. In the event that you become unable to provide or care for your child, the person you gave power of attorney to may be able to step in and assist.
While these are two important elements of any new parent’s estate plan, please note that this is not an exhaustive list of all estate planning steps you may want to take.