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Estate planning for new parents

On Behalf of | Apr 11, 2022 | Estate Planning

The beginning of your new child’s life is the time to address their care in case the worst happens, and you die.  Making these plans for your estate can help assure that your family’s financial needs are met.

Life insurance

Purchasing life insurance is an important component of estate planning when you have children. This helps assure that there is money available for your surviving spouse to pay the high costs associated with raising children. If both parents die, life insurance can help raise the child to adulthood or pay for their education.

Term life insurance is probably the best choice for most new parents. Premiums are less costly, and the coverage will remain in effect until children become adults and are no longer financially dependent.

A whole life policy, however, may be better if there is a child with special needs who will need care after their parents die. Whole life policies can provide financial resources for lifetime care.

Wills and guardians

There are two important reasons for a will. First, to designate who will receive your assets. The second and more important reason is to name a guardian for your children.

Choosing a guardian should be done immediately after your children are born.

It is important to make this decision, or you may have family members fighting over who should be a guardian. Having a court rule on this is inadvisable and may not address your wishes and concerns.

Naming a guardian allows you to select a person who shares your values, have a relationship with your children and work hard to raise them.


Some accounts go to designated beneficiaries on those accounts regardless of what is in your will. These typically include a 401(k) or IRA. Life insurance policies also have designated beneficiaries.

Once you have children, it is important to designate these beneficiaries or update beneficiaries. Typically, your spouse or partner will be the primary beneficiary. Designating your children as secondary beneficiaries will assure that they inherit those assets if you and your primary beneficiary die.


Your children cannot directly assume control of their inheritance if you die before they are 18. This can cause problems. A court may appoint someone to manage these assets. Irresponsible young adults may have unfettered assets to a large amount of money.

Creating a trust can help you control who will manage these assets, how your money and assets may be used for your children and when children may receive a wealth transfer.

You can designate a person to manage money and assets on your children’s behalf and provide instructions how these may be used for your children’s benefit. You may also set conditions on children receiving a direct transfer of assets until they reach a certain age or enter college.

Attorneys can provide estate planning options to new families. They can prepare documents that, unlike boilerplate forms and do it yourself documents, specifically address your needs and comply with Missouri legal requirements.