Becoming a parent is exciting and simultaneously terrifying. Children cannot handle much on their own and depend on their parents for everything from housing and nutrition to health care decisions. Parents generally expect to spend roughly two decades, often substantially longer, providing financial support and regular guidance to their children.
Unfortunately, not all parents live long enough to watch their children reach adulthood. Some parents tragically die while their children are still relatively young. Parents who have estate plans in place can protect their children against the worst-case scenarios possible after the passing of a parent. How can an estate plan protect a minor child?
By naming a guardian
If there are no adults to step up to care for a child, then they could become a ward of the state. They might end up in foster care, possibly even living in a separate home from their siblings.
If a parent takes the time to create a will and name a guardian, they can help ensure that someone they trust assumes responsibility for raising their children after their untimely passing.
By providing financial support
A solid estate plan aimed at protecting children typically includes financial support. Parents might specifically purchase life insurance to provide financial support for their children after their passing. They may also want to create a trust to ensure that the guardian caring for their children does not misappropriate or waste the resources that they gain access to through their position.
Those who consider the worst possible scenarios can provide the best degree of protection for their loved ones in their estate plan. Having sound estate planning guidance can help.