Estate Planning Guide for Young Families: 2021

If you have just had a baby or have young children that are under 18 years old you need an estate plan. Parents with young children are busy raising their kids and working to make ends meet. However, have you thought about what would happen to your children if you weren't around? No one expects to die or become disabled when they have a young family, but planning for these possibilities is one of the most important thing you can do for you kids.

Here is what happens to your estate if you die without a formalized Estate Plan in Illinois:

What Happens when there is No Estate Planning for Young Families?

1. Division of Probate Assets:

Your surviving spouse and your children will divide your probate assets 50/50. It doesn't matter if your child is 6 months old -- they still inherit 1/2 of your probate estate. It doesn't matter if you own a business -- your children will inherit 1/2 of your business. Also, it doesn't matter if your spouse may need all of your estate to live on after you die -- without estate planning your children are entitled to 1/2 of your probate estate.

2. Who takes care of the children?

If there is a surviving spouse, then he or she would continue to care for the children. However, if both parents die at the same time and no guardians for the children have been named in a will, then family members would have to petition the court to be appointed guardians of your children. This could be a contentious court battle to see who becomes guardians of your children and you don't have any control over who gets appointed.

3. How is money managed for your children?

In the event that both parents would die at the same time (such as in a car accident, etc.) without an estate plan, the Courts would have to appoint a guardian to oversee and manage money your children inherit until they turn 18 years old - and once they turn 18 years old your children would then have control over their inheritance. By setting up a Children's Trust as part of your Estate Plan you are making sure your assets will be properly managed and distributed to your children to help benefit them most in hard times.

Recommended Estate Plan for Young Families:

There are many things to consider when designing an Estate Plan; however, a basic estate plan that will give a young family Peace of Mind will generally consist of the following for each spouse:

  • a Will with Children's Trust;

  • a Power of Attorney for Property; and

  • a Power of Attorney for Healthcare.

There are four things a Young Family needs to consider for their Estate Plan:

1. Naming an Executor for Your Estate.

Who should be the Executor of your estate? An Executor is responsible for probating your Will, paying your debts, collecting your assets, and settling your estate. Generally if you are married you would appoint your spouse as your first choice for Executor. I also highly recommend you name one or two alternative people to be your Executor just in case the person you originally name can't act for some reason.