Truthfully, estate planning is the right choice for most Rancho Cucamonga residents, and it is critical if you have a young family. If you die without an estate plan, your assets will be handled based on California laws, regardless of your wishes. This includes everything from the contents of your bank accounts to where your minor children will live.
Estate Planning for Your Young Family
Making a plan for your minor children in your will in the event of your death is essential to estate planning. Here are some steps to help you get started on your plan:
- Name a Guardian – In your will, a guardian is the person who accepts responsibility for the care and custody of your young children if you die.
- Create a Trust – Consider setting up a trust that can provide for your children’s financial needs until they reach the age of majority. This can be done through a testamentary trust in your will or a separate living trust.
- Determine Distribution of Assets – Decide how and when your assets will be distributed to them. This can be done through the trust or directly through your will.
- Provide for Education – Consider including provisions in your will or trust to provide for your children’s education, including funding for tuition and related expenses.
- Consider Life Insurance – If you have minor children, it may be wise to consider purchasing life insurance to provide for their financial needs in the event of your death.
- Review and Update Regularly – Be sure to review and update your will regularly to ensure that it reflects your current wishes and circumstances.
Consulting an estate planning lawyer in Rancho Cucamonga can ensure your plan meets your unique needs and goals.
Selecting a Guardian for Your Children
Many parents delay deciding on a legal guardian for their children. It is a huge responsibility, and you may be concerned about making the wrong choice. Here are some points to consider when selecting a guardian:
Safe and stable environment – Consider the potential guardian’s ability to provide your children with a safe and stable home environment. This includes assessing their living situation, financial stability, and parenting skills.
Shared values and beliefs – Determine whether the person(s) shares your values and beliefs regarding raising children, such as religion, education, and discipline.
Proximity to family and community – Is the potential guardian near your family and community? This can impact your children’s ability to maintain relationships with loved ones and stay connected to their support network.
Willing and able – Find out if the potential guardian is willing and able to care for your children in the event of your incapacity or death.
Relationship with your children – Does the guardian of your choice have an existing bond or relationship with your children? This can ease the transition and help them move forward with their lives.
Talk to the prospective guardians before finalizing your estate plan to ensure they are prepared for the responsibility. Many parents automatically consider the children’s grandparents as future guardians. However, health issues and advanced age may not make that a realistic option.
Set Up a Trust for Young Children
A trust is an agreement between two parties, you the settlor, and a trustee. You provide the assets, and the trustee manages and protects assets, then distributes them per your instructions. You can set up funds to hold life insurance policies, protect assets from creditors, and avoid probate. Trusts can enable you to care for your children long after you die, and they can help pay for everything from everyday expenses to their education.
When setting up a trust for minor children in a California will, there are a few options to consider. Here are some of the most common types of trusts used for this purpose:
Testamentary Trust – This trust is created in your will and takes effect upon your death. You can use it to provide for your minor children until they reach a certain age, at which point they will receive the remaining assets in the trust outright.
Revocable Living Trust – Created during your lifetime, this trust can be changed or revoked anytime. It is typically used to provide for minor children both during your lifetime and after your death.
Irrevocable Trust – An irrevocable trust cannot be changed or revoked once established. You can use this trust to provide for your minor children and offer tax benefits.
When deciding which type of trust to set up for your minor children, keeping your individual circumstances, goals, and preferences in mind is essential. Consulting with a Rancho Cucamonga estate planning lawyer to can you determine the best option for you and your family.
Periodically Review and Update Your Rancho Cucamonga Estate Plan
Reviewing and updating your estate plan periodically to ensure that it reflects your current wishes and circumstances is a good idea. There are a few situations where you may want to consider updating your will:
Changes in your family or personal circumstances – Major life events such as marriage, divorce, the birth of a child, or the death of a family member
Changes in your financial situation – Changes in your financial situation, such as the acquisition or sale of assets, may require updates to your estate plan to ensure that your assets are distributed according to your current wishes.
Changes in the law – Changes to California’s laws or tax laws may require updates to your estate plan to ensure that your estate is structured in the most tax-efficient manner possible.
Changes in your relationships – Changes in your relationships with family members, friends, or potential beneficiaries may require updates to your estate plan.
Generally speaking, it is recommended that you review and update your estate plan at least every five years or when a significant life event occurs.
Get Help from a Rancho Cucamonga Estate Planning Lawyer
California’s laws regarding estate planning can be confusing. Consulting with a skilled lawyer can help ensure your estate plan is structured to meet your goals. Get peace of mind, knowing your family is cared for if the unthinkable happens. Contact the Law Offices of Terrence Fantauzzi or call 909.552-1238 to schedule an appointment today.