As a recent article points out, putting together an estate plan is one of the most important things a parent can do for his or her children. Parents must plan for the fact that they will not be around forever and ensure that their children will be properly cared for should the unexpected occur.
One important step parents should take is to execute a will. Even if you decide to transfer your entire estate through alternative estate planning tools such as trusts, a will is still a vital part of your estate plan. Importantly, through a will parents can select the person who they trust to care for their children should they become unable to do so themselves.
Trusts are also an important estate planning tool for parents. It is important to bear in mind that trusts are not just for wealthy families. Any parent with assets such as a home, life insurance policy, or retirement account may benefit through use of a trust. Through a trust, parents can provide that their children will not receive certain assets, such as the proceeds of a large life insurance policy, until they are old enough to handle the asset responsibly.