01 July 2014
Legal tips for new parents
The summer months are the most popular time for babies to be born and, if someone in your family is expecting the patter of tiny feet, then prepare for life to change in a big way. Of course, the early days will fly by in a routine of feeding, bathing and grabbing a few hours of much-needed sleep.
As the child grows up however, there are many financial and legal considerations to think about alongside the more day-to-day battles, such as persuading them to eat their vegetables or tearing them away from the latest social media trend.
According to an annual report from insurer LV=, the cost of raising a child and supporting them through university until the age of 21, is now over £227,000, which includes food and clothing, hobbies and education.
Writing in the introduction to the report, Mark Jones, LV=’s head of protection, said: “Bringing up a family has never been more expensive and the costs are set to remain a pressure point for many families across the UK.
“Setting out the total cost of raising a child helps highlight to parents the need to secure their family’s financial future should anything unexpected happen.”
Planning ahead and preparing for both the expected and the unexpected is something that the private client practice at B P Collins believes is essential. The team has put together a simple guide for new parents to help them consider the legal implications they need to think about when a baby arrives.
Craig Williams explains: “We know any parent will be completely focused on their latest arrival, but it’s important they take time out to consider how to protect and support their expanding family in the longer term.
“There are many things new parents – and grandparents – can do at an early stage to help secure a child’s financial future, for example, by setting up a trust to pay for school fees, or dividing an estate in a particular way.
“It’s also important that where there are already children from a previous relationship, careful consideration is given to looking after their best interests in the event of something happening to a parent. We hope this guide will act as a useful reference point for all new parents and wider families.”
As a new parent, consider the following tips from our private client team:
- Make a will to ensure your children are adequately provided for in the event of your death. You may have additional children in the future, so ask your solicitor for the best way to include them in the will.
- Appoint guardians for any children under 18 so, if the worst happens, you know who will take responsibility for looking after them.
- If grandparents are keen to help, then talk to them about Inheritance Tax planning. Putting a trust in place now can help with future expenses such as school or university fees.
- Although children can demand their inheritance at 18, many parents take the view that they would prefer their children to be older and more responsible before managing a large sum of money. Trusts can be written into wills to ensure that any monies are only inherited at a later date, although they could potentially be accessed to pay for items such as university fees.
- Where there are children from different marriages or previous relationships, it’s important to consider how to treat them fairly, especially if one child is likely to inherit from another source such as a grandparent. A solicitor can help you explore the best way to achieve this.
- This can also apply where an individual wishes his or her children to inherit capital from an estate rather than it passing outright to a spouse (particularly if it is a second marriage). Ensuring there are flexible trusts within a will can ensure assets are protected.
- When dividing an estate between children, the ability to include lifetime gifts can be a helpful way for parents to help their children out financially, for example, when they are buying their first home.
Call our private client team on 01753 279030 or email your enquiry to firstname.lastname@example.org