Welcoming a new baby is one of life’s most joyful experiences, but it also brings new responsibilities. As you begin adjusting to life with your little one, it’s important not to overlook a crucial question: Does your Estate Plan still reflect your wishes now that you’re a parent?
For many families, the answer is yes, you need to update your estate plan after the birth or adoption of a child. Here’s why:
1. You’ll Want to Name a Guardian
One of the most important reasons to update your Estate Plan is to legally name a guardian for your child. A guardian is the person who would step in to care for your child if something happened to you (and the other parent, if applicable).
If you haven’t named someone, a court will make that decision, and it may not be who you would have chosen. Including guardianship in your will gives you peace of mind that your child would be raised by someone you trust.
2. You May Want to Create or Update a Trust
Leaving assets outright to a minor isn’t recommended. If you were to pass away without proper planning, the court might control your child’s inheritance until they turn 18, and then they’d receive everything at once, with no restrictions.
By creating or updating a revocable living trust, you can:
Name a trustee to manage the assets on your child’s behalf
Decide at what ages your child will receive distributions
Provide for your child’s education, care, and needs long-term
3. Add Your Child as a Beneficiary
You may want to add your child as a beneficiary on life insurance or retirement accounts, but doing so directly may not be the best approach. Minor children cannot legally manage inherited funds, which can cause complications.
Instead, your trust can be named as the beneficiary, allowing for smoother management of the assets for your child’s benefit.
4. Update Powers of Attorney and Healthcare Directives
While these documents may not directly involve your child, you might want to revise them to:
Ensure your chosen agents still make sense in your new family structure
Provide instructions for temporary care of your child if you’re incapacitated
5. Plan for Ongoing Support and Peace of Mind
Your Estate Plan is not just about what happens after you’re gone. It’s also about creating stability and support for your family in the years ahead. Updating your plan ensures that your growing family is protected and that your values are reflected in every decision.
Having a baby is the perfect time to revisit your Estate Plan, or create one if you haven’t yet. At Law Office of Lori Vella, we’re here to guide you through the process with compassion and clarity. We know this is a tender and busy time, and we’ll help you create a plan that gives you peace of mind for the future.
Lori Vella is an Estate Planning and Business Attorney. She works virtually throughout Florida and New York, but has her home office in Tampa, Florida. She is mom to a little boy which ignited the passion for helping other families. She and her son enjoy car rides, playgrounds and taking mini-adventures. They also have an organic garden that surprisingly yields vegetables. Lori considers herself well-versed in Seinfeld and welcomes any trivia!
Disclaimer: The Law Office of Lori Vella’s website contains general information directed to Florida residents. This firm does not intend to give legal advice through its pages and/or blog. If you need legal advice, we encourage you to find an attorney licensed in your state. This language on this website does not create an attorney-client relationship between you and this firm.