If the idea of getting your financial and estate plans in order sends you into an anxiety sinkhole, you’re not alone. Most Americans don’t have a will. Lots of parents are too overwhelmed to make a plan, or worse, they postpone financial planning because they feel strapped – for money and for time. If you’re waffling, confused or overwhelmed, here’s what you need to know at every stage.

Early Years: Prep and Plan

New parents have a few must-dos. First, they need to create their estate-planning documents, including a will and power-of-attorney forms, or update the ones they have. These forms need updating after any big life change, including marriage, new baby, divorce, death or major illness, and are usually crafted by a lawyer.

If you don’t have life insurance, consider it. Life insurance pays cash to your surviving spouse and children if you die during the policy’s term. It comes in two basic varieties: term, a policy that ends after a pre-set term and pays nothing thereafter, and permanent or “whole life,” a policy that pays your survivors after you die, no matter how long you live. Term life insurance is a solid, straightforward and (yay!) cheap choice for new parents. In most cases, coverage worth up to five times your annual income costs less than a meal out (insurers use several factors to determine costs, including age, health and life expectancy). Those with a child who might need long-term care may want to consider a permanent policy, which costs more but can provide more long-term security.

If you’ve already got life insurance, check the beneficiaries on the policies, and check those on retirement savings accounts as well. You may want all or a portion of the money to go to into a trust that your child will inherit as an adult, or to the person you’ve selected as your child’s legal guardian. These payouts can be some of the biggest assets parents should consider, and the recipient is determined by the beneficiary designation – not, as many assume, by your will.

To change your beneficiary designation, it’s usually just a phone call to the financial institution or insurance company where the account is held and a few forms to sign. An estate-planning attorney can help make sure you get this done, though; parents who craft their own wills sometimes forget this step.

And you can’t escape the B word: It’s time for a budget. New parents may need to change their spending and saving habits. Find tools to help you at mint.com, budgetpulse.com and ynab.com (You Need A Budget). If you cringe at the thought of tracking every penny, take heart: After a quick ramp-on period where you input your info and link your bank accounts, budget software streamlines month-to-month planning, giving you a quick at-a-glance snapshot of your spending and highlighting opportunities to pocket extra savings.

Elementary Years: Start Saving Now!

It’s time to start thinking about college savings, if you haven’t already. That’s where your budget helps: If you’ve got a good handle on your spending, it won’t be too painful to set aside a small amount each month. If money is tight, don’t get bogged down in how much you can save, even $10 a month creates a habit.

Financial planners recommend putting the savings in 529 plans, “qualified tuition plans” sponsored by states or educational intuitions. These plans are tax-protected, meaning the cash grows tax-free, and won’t be taxed when withdrawn for educational expenses. (New legislation now allows funds to be used for K-12 and private school expenses in addition to college.) Choosing a tax-protected plan can yield extra cash for college. Saving $200 monthly for 18 years in a tax-advantaged plan nets $14,000 more for college, compared to a savings account without tax advantage. And since funds can be used for schooling in any state, you don’t have to choose your state’s plan; the CollegeAmerica 529 is a good choice.

But saving for college doesn’t mean you get a pass on your own retirement savings. Too often, parents say they can’t save for retirement because they’re saving for their kids’ education; keep in mind that your child can get loans and scholarships for college, but you can’t get a scholarship for retirement.

“The number one mistake parents make is that they save for their kids’ college but neglect saving for their own retirement,” says consumer advocate and money expert Clark Howard. “Sacrificing your future for your kids doesn’t work. Save as much money as you possibly can for your own retirement. If there is money left over, put it in a 529 plan.” Howard recommends Georgia’s Path2College 529 Plan; visit clark.com for details.

Saving 10-15% of your income toward retirement is a good benchmark, but individual goals and budgets vary; as with college savings, it’s better to build a habit of regularly saving a small amount than to skip it altogether. Eating out one less time each week can yield a couple hundred dollars per month to put into your 401K or an IRA.

Tween and Teen Years: Big Kids, Big Expenses

In the middle and high school years, bills for everything from team sports to school supplies to braces can wreck your budget. Get ahead of spending in health and dental care. If eligible, take advantage of a health savings account, pre-tax dollars set aside for medical and dental expenses.

“It’s hard for any family to deal with expenses that come along – expected and unexpected,” says Howard. “Relieving money pressure starts with every dollar you earn, not the spending you do. Save a dime of every dollar you make. If you think throughout your working lifetime and the time of raising your children, that what you really have to live on is 90 cents of each dollar you make – instead of a dollar of each dollar you net on a check – it changes the economics and lowers the anxiety in your life.”

If you’re late to the college-savings game, there’s still time to set aside some cash. But if your child is already in high school, you may want to skip investment accounts and deposit funds into a regular savings account instead, making the money easier to access in a few years’ time. And every teen should be thinking about scholarships, especially those for whom college savings are scarce. The teen years are the right time to begin building your child’s own financial savvy, too. Bestselling author and financial guru Dave Ramsey recommends setting up a checking and savings account for your teen, along with a monthly auto-transfer of the amount you’d normally spend on their clothing and incidentals, so they can start managing their own money. Resist the urge to rescue your spend-happy teen who comes up short at the end of the month; paying a few overdraft fees could offer a valuable, if costly, lesson in self-control.

Wills: What to Know

Confused about communicating your final wishes? Here’s what parents need to know.

What: Your “estate planning package,” legal-speak for the documents dictating your wishes about what happens to your offspring and assets if you die or become incapacitated due to illness or injury, includes your will and your power-of-attorney forms, documents that designate someone to make decisions for you if you’re unable to make them for yourself. At minimum, you need two power-of-attorney forms: one to cover your financial affairs and one to cover your health care needs. Some attorneys also prepare a separate health care directive that specifies what you’d like your family to do if you’re in a permanent unconscious state.

Where: To get these done, see a lawyer or online to a service like Legal Zoom. Do-it-yourself wills are easy to find online, but beware that they’re often cookie-cutter forms that don’t represent your state’s specific laws. For example, Georgia law specifies that handwritten wills are not legal; they also must be signed by two impartial (read: not affected by its outcome) witnesses. Skip this step, or another one of your state’s legal requirements, and the court won’t uphold your will, no matter how comprehensive.

When: Plan to update your estate planning documents after any major life change (the arrival of a new baby, a death in the family, or divorce or remarriage) or every five years. If you’re creating a new estate plan with an attorney’s help, expect the process to take anywhere from a few weeks to a few months.

How much: Prices range from free for generic online forms to $500-$1,000 for an attorney’s estate planning package.

– Malia Jacobson

Educating Kids About Money

“As parents, we get frustrated with our kids and their attitudes toward money,” says Clark Howard, consumer advocate and money expert. Here are a few of his tips on teaching financial responsibility.

Educate. “Kids don’t really understand that money is finite, so parents can feel like, ‘don’t they understand that money doesn’t grow on trees?’ Over time, teach your kids the fundamentals of money and its finiteness.”

Go shopping. “Starting in about first grade, take your kids into a store, like a supermarket. As you shop, talk through the cost of items and unit pricing. How much does something really cost?”

Explain the concept of budgeting. “You don’t want kids to grow up with the attitude that there is always more money, because they carry that attitude into adulthood. You’re doing them a big favor, not by saying no, but by taking opportunities over time to teach the value of each dollar that comes into your life.”

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