As a new parent, you naturally want to ensure the success of your child's future in every way. For many new parents, infancy is a time for acclimating, caring for your little one, and celebrating each little first. Making a will might be the last thing on your mind. Or maybe, like many others, the process of bringing new life into the world sparks an intense desire to control your environment or organize your surroundings. Regardless of where you fall on that spectrum, you might be struggling to figure out what steps you need to take to protect your child's future should the unthinkable happen. Here are five key points every new parent should know about wills.
- Naming a guardian could be the most important part of your will.
If you pass away while your child is a minor, the first issue to be addressed is who will assume responsibility for the care of your child. In Tennessee, if a guardian for your child is not named in a will, the courts decide this question for you, and the guardian might not be the person you would choose. Selecting a trusted guardian is in many ways more important at this stage than deciding how to pass on any assets you own, although of course, that issue is important too.
- Name an executor who you trust.
To ensure your child does receive all that you have allocated when your child comes of age, choose a trustworthy executor. An executor is the person who will be responsible for carrying out the instructions provided in your will. Many people choose a family member, but it's just as acceptable to appoint a trusted friend or attorney to handle your estate. Typically, an attorney has no emotional attachment to the family, which might seem an odd choice, but can result in less potential conflict.
- Named beneficiaries on your financial accounts may override the will.
Many types of accounts allow you to name a beneficiary. When you pass away, the funds go to the beneficiary named on the account, even if your will states otherwise. If you're creating a will with your child in mind (or adding a child to an existing will), you should review your investment and bank accounts with your financial advisor to make sure there are no inconsistencies when naming beneficiaries. It's also a good time to check retirement accounts and life insurance beneficiary designations with your financial advisor and your attorney.
- A will is not always the right document for your goals.
When naming your child as a beneficiary, a will only goes into effect after you die. If your will leaves property outright to a minor child, the court will step in to ensure that the assets are held until your child turns 18. Most 18-year-olds lack the maturity to handle even a modest estate, so we don't recommend outright inheritance for minor children.
A trust, on the other hand, goes into effect when you create it and can provide structure to manage the assets you leave behind for the benefit of your child. An experienced estate planning attorney can advise you on the best option for your family and your circumstances.
- In the absence of clearly stated intentions, the state of Tennessee steps in.
Think of a will, trust, and other estate planning documents as an instruction manual for your executor and the courts to follow. You must be clear and consistent in your stated intentions regarding your child, as well as for others. If you're not clear or if you don't leave any instructions at all, the probate courts will step in and follow the government's plan (Tenn. Code Ann. § 31-2-104, Tenn. Code Ann. § 34-2-103), which can lead to long delays and might not be the plan you would have selected for your child and family.
Providing for your child's long-term welfare may start with just a simple will, but to be fully protected, you probably need more. That's why it's important to talk with a competent estate planning attorney to make sure you have the right plans in place to fulfill your goals. We're here to help! Contact us today to talk about your options to better protect your family.
Also available on our blog: Considerations When Choosing a Guardian for Minor Children and Estate Planning for Blended Families
Have general estate planning questions? Start with Estate Planning Basics & Benefits!
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Posted by Jim Foster
