You may not have considered writing a will before, but in this article, we’ll provide 10 reasons you should consider it as a new parent…
As a new parent, your first thoughts won’t be to imagine the worst and have a Will written up in preparation. But, it’s also perfectly normal to put plans in place that directly protect the interests of your children.
Being a parent means always wanting to provide for your children even if you’re no longer around. Perhaps you’ve remarried and now have stepchildren to consider, who otherwise would have no legal right to your assets but who you’d like to provide for also. There’s plenty you need to prepare for in these situations.
For example, if you plan on leaving behind large sums of money, you may want to seek inheritance tax advice from a professional to know exactly how the tax will impact how much you leave behind. This way, you can divide it equally and fairly amongst your children. With all this in mind, here are 10 reasons you should consider writing a will as a new parent…
To Appoint a Guardian
Now you’re a parent, it’s a good idea to consider people in your life that you would like to appoint as a guardian should anything happen to you. This needs to be given careful thought, and you should discuss it with whom you’re thinking of appointing.
If you don’t choose a guardian, you should know that the local authorities will. Guardianship is usually appointed to immediate family, although this isn’t always a certainty. You can also appoint more than one guardian should people’s situations change; it’s good to have back-ups.
You should also be aware that Godparents don’t count as guardians, and have no legal rights to your children. However, you can of course name them as guardians in your Will if you wish to.
Provide a Financial Plan for Your Children
The average cost of bringing up a child to the age of 18 equates to £230,000. Could your family or chosen guardians afford these expenses? Your estate could potentially cover the costs of raising your child, but only if you make it so in a Will.
Your ‘estate’ covers your bank accounts, pensions, investments, home, car, and any smaller assets in your name. It also covers any rights or licenses you might own.
Another factor to consider when providing a finance plan for your children is your partner. For peace of mind, you know you’ve left instructions for them, and you can feel confident that your partner and children are provided for.
Provide for Step-Kids and Other Dependants
Being a new parent doesn’t just apply to your biological children. It also applies to any stepchildren or dependants who won’t be legally entitled to any of your estates if it’s not specified in a will. This also applies to foster children.
Decide an Age for Inheritance
Consider at what age you would like your children to inherit the assets you’ve left for them. Whilst it’s usually handed to them at the age of 18 if not specified otherwise, you may want to consider if that is an appropriate age.
You might want to push the age of receiving an inheritance to age 21 or 25 for when your children are older and perhaps more responsible. You should know that you can appoint a trustee whom they can withdraw money from with their consent before they reach the chosen age, should they need it.
Appoint Trustees for Child’s Inheritance
If you pass away before the age your children can inherit, their assets will need to be held in trust. As mentioned above, you can appoint a trustee to ensure that your child’s inheritance is passed to them at the appropriate time and to manage the trust withdrawals.
A lot of thought should be put into who you trust to safeguard your children’s assets and help plan their future. The trustee is essentially in charge of your children’s finances. You could appoint your partner, but it’s a good idea to have more than one trustee in the event both parents pass away.
Think About Trust Beneficiary Payouts
If you’re leaving a large lump sum of money to your children, partner, or other beneficiaries, then you should consider the impact payouts will have. A large lump sum of money may come from a life insurance policy, for example. You can decide exactly how this will be split amongst your beneficiaries and when they’d receive the payouts.
If you’ve established a trust for your children, you’ll need to give thought and discuss intentions with the trustee as to when you want them to receive payouts. You may wish to gift your beneficiary money when they’re looking to get on the property ladder when they’re going to college, or want driving lessons etc. Of course, the details will be outlined in your Will, so it’s not forgotten.
Think About Family Heirlooms
You don’t want family heirlooms to be lost after your days. By listing specific items in your will, you can ensure they are passed down to your children the way they were left to you.
The executive of your will is given the responsibility to make sure your possessions go to whom they’re meant to. This is someone you’ll need to appoint yourself; another valid reason to get your Will sorted.
Make a New Will if You Get Married
As you know, marriage is a legally binding contract in itself. Assets become split, therefore altering your wishes in any original wills prior to marriage. Failure to update your will after a new marriage can leave your assets in a messy situation.
For example, if your intention is to leave your property to your child, but your new spouse or their stepparent owns half of the property, you can only leave half of the property to your children. It’s worth having open conversations with your new spouse about what they would like to leave in their will with regards to your children, so you have transparency on shared assets.
Make Your Intentions Known
As mentioned, your will is the last piece of communication left by you for your family. It can act as a great source of comfort for your family to know you thought to have your assets in place for them after you pass.
Failure to do to a Will at all, or not give enough attention to one, can leave a sour taste in mouths and unless that’s your intention, it can cause a lot of unnecessary upset.
Review Your Will
Having a baby or becoming a primary caregiver of a child is a significant stage in your life. It’s recommended that you review your will in times like this to make sure it’s up to date and you’ve considered any new updates in your life as part of the Will.
Don’t Leave it Too Late to Make a Will…
If you’ve left it too late to write a will or you die without one, there is nothing anyone can do to ensure your intentions are known. It’s a huge comfort to children to know their parents were thinking of them when deciding to make a will.
Don’t forget the security you’ll also feel after making your will, knowing you’ve done everything possible to provide for your children, even after your days.