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Ask USAA: What steps should I take to protect my child if I die?

Hello, and welcome to Ask USAA. My name is Scott Halliwell. We have a question today from Ayako in Hawaii regarding estate planning. She says, "As a single parent, what steps should I take to protect my child if I die?"

Well thanks so much for this question Ayako. You know far too many people put off this extremely important aspect of financial planning, so I'm glad you asked my input as to what you should do here. You know to protect your child, you really want to have four key legal documents in place. You want to have them created by an attorney that specializes in estate planning in the state where you live. The other thing about this is these documents are good whether you're single or married. It really doesn't matter.

The first document you want to have in place is an up-to-date will and/or a trust, depending on your particular situation. You know what this is, is a set of instructions that's going to lay out, at a minimum, who gets what assets at your passing. And more importantly in your case Ayako, who's going to take care of your child.

The next document that you want to have in place is a durable power of attorney. You know this document is going to provide somebody else with the opportunity or the ability to make financial decisions on your behalf if you become disabled or temporarily incapacitated.

The next thing you want to have is a health care power of attorney. It's similar to the durable power of attorney, but instead of being financial in nature, it's health care in nature. So essentially, it gives somebody else the opportunity to make health care decisions on your behalf.

The final legal document that you want to have is a living will. What a living will does is it lays out your wishes relative to life support.

You know in addition to these legal documents I've talked about, there's another document I think you should have. And though it's not legal, it's still very important. It's called a letter of instruction. And what it does is it specifies things like your funeral arrangements. It also allows you to outline any other instructions that you think would be important upon your death.

You know the final point I want to make about all these documents is that having them isn't enough. Yes, you need to have them. But they also need to be reviewed on a regular basis. Typically, I would say you want to do that at least every five years or when any major life event takes place, such as the birth of a child, a death in the family, marriage, divorce, you know, move to another state. Those types of things. The bottom line here is these are not set it and forget it documents.

So Ayako, while this information should get you started, it is by no means a substitute for having a meeting with a qualified estate planning attorney in your area. My suggestion would be that you set up that meeting as soon as possible. Thanks again for the question, and best of luck to you and your child.

 

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Views and opinions expressed in this program are provided for informational purposes only and are subject to change. This discussion is not tax, legal, estate planning or USAA product advice and is unique to the member only. The law concerning tax and retirement plans is complex, penalties are severe, and the laws of your state may differ. Consult with your tax, legal or estate planning professional regarding your specific situation.

 

This material is for informational purposes. Consider your own financial circumstances carefully before making a decision and consult with your tax, legal or estate planning professional.

 

USAA or its affiliates do not provide tax advice. Taxpayers should seek advice based upon their own particular circumstances from an independent tax advisor.

 

Certified Financial Planner Board of Standards, Inc. owns the certification marks CFP® and CERTIFIED FINANCIAL PLANNER™ in the United States, which it awards to individuals who successfully complete CFP Board's initial and ongoing certification requirements.

 

Financial planning services and financial advice provided by USAA Financial Planning Services Insurance Agency, Inc. (known as USAA Financial Insurance Agency in California, License #0E36312), a registered investment adviser and insurance agency and its wholly owned subsidiary, USAA Financial Advisors, Inc., a registered broker dealer.

 

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