Author of the book Estate Planning Smarts, Deborah L. Jacobs, was interviewed by Christine Benz of Morningstar Inc. In the interview, Ms. Jacobs spoke about why new parents need a will to protect their children:
The most important thing — and it’s something that I recommend people do almost immediately after becoming parents — is to be sure that you have a will. This is not only to transfer assets, but to appoint a guardian for your child if for some reason the child is orphaned. People don’t realize that a will is the only document they can use to do this, and if they don’t, then the whole matter has to go to court.
Ms. Jacobs also emphasizes that estate planning is not just for the wealthy; regardless of your financial means, a will helps to ensure that your children are taken care of in the event of your death.
If something were to happen to you and your partner while your children were still minors, how would you divide your assets among them?
If you answered “equally,” you are like many parents who presume that giving each child an equal share of your estate is the fairest solution. But in some cases, uneven distributions may be a better — and surprisingly fairer — alternative.
The way you currently provide for your children is based on need rather than on equity. If Susie needs to see a doctor, it does not matter that she has gone to the doctor twice more than Bobbie this year; you take her to the doctor’s office anyway. Your financial decisions are based on needs as they arise, not a meticulous accounting to ensure that you spend exactly the same amount on each child. Your estate plan should match this.
If you have minor children, an important aspect of your estate plan will be selecting a guardian or guardians to take custody of your children after your death. Selecting a guardian can be difficult, and you and your parter (and attorney if possible) should deeply discuss all possible options before making a decision.
When selecting the individual who will take guardianship of your children, there are a few things you should consider.