Estate Planning For New Parents In Michigan: A Step-By-Step Guide

Last updated on April 20, 2026

Estate planning for new parents focuses on protecting minor children and creating a legal framework that supports the family if something unexpected happens. Without a plan in place, courts may have to make decisions about guardianship and asset management. For that reason, working with an attorney can help parents put the right documents in place and make sure their wishes are clearly documented.

At Brown Borkowski & Morrow, our team can help parents establish legal protections that support their children and give their family a strong foundation for the years ahead. From our office in Farmington Hills, Michigan, we work with parents who want practical estate planning tools that protect their children and preserve family assets.

Why Every New Parent Needs A Legal Safety Net

While estate planning is associated with passing away, for new parents, the focus is much broader. The goal is to create a legal safety net that protects a child in any situation. This includes unexpected illness, injury or other circumstances that could prevent a parent from caring for their child.

If parents have not legally named a guardian, the decision may fall to the Michigan probate court. The court would review potential guardians and determine who should assume responsibility for the child. While courts work carefully to protect children, the person selected may not be the individual parents would have chosen themselves.

Estate planning also helps ensure that the surviving parent or partner has clear legal authority to act immediately. This authority may involve managing finances, making medical decisions or handling legal matters connected to the child. By creating a plan early, parents can:

• Select a guardian who shares their values
• Provide instructions for managing their child’s inheritance
• Prevent delays in accessing financial resources
• Help ensure medical and financial decisions can be made quickly

For families in Farmington Hills, Michigan, estate planning for parents becomes a way to place protective measures around the people who matter most.

The 5 Pillars Of Estate Planning For Young Families

Estate planning includes several legal tools that work together. Each serves a specific purpose in protecting minor children and organizing family finances.

The five pillars most young families rely on include:

• Will: This is a document most people recognize. It allows parents to formally name the legal guardian who would care for their child if both parents pass away. Without this document, the court must determine who should raise the child. A will allows parents to make that decision themselves and place it on record. It can also appoint an executor who manages the estate and helps ensure assets are distributed according to the parents’ wishes.
• Revocable living trust: It is commonly used when parents want to organize how their child receives financial support. If assets pass through probate, the process may take time and involve court supervision. A trust allows assets to be transferred and managed outside of that process. Additionally, a trust allows parents to control how inheritance is distributed. Instead of a child receiving a full amount at age 18, the trust can release funds gradually. For example, parents may choose to distribute funds at specific ages. This structure helps ensure funds are used responsibly.
• Power of attorney: A financial power of attorney allows parents to appoint someone they trust to manage financial matters if they become incapacitated. This person may be responsible for tasks such as paying the mortgage or rent, managing bank accounts, handling tax filing and maintaining insurance policies. Without this document, family members may need to request court approval before accessing financial accounts.
• Health care directives: These allow individuals to outline their medical preferences and name a person who can make medical decisions on their behalf. For parents, this prevents situations where loved ones must guess what treatment choices should be made. Instead, written instructions guide those decisions. These directives help ensure medical wishes are respected while also easing stress for family members during difficult moments.
• Beneficiary designations: Certain assets transfer directly to beneficiaries rather than through a will. These include life insurance policies, retirement accounts such as 401(k)s and IRAs, and some investment accounts. When parents welcome a new child, it is important to review these accounts. Updating beneficiaries helps ensure the child is properly included in the overall estate plan.

When these five pillars are properly structured, parents create a strong legal framework that protects their children and supports the family’s future.

Choosing A Guardian: More Than Just A Godparent

Many parents wonder how to choose a guardian for their child. Some assume that a child’s godparent automatically fulfills this role, but a godparent has no legal standing unless they are named as the child’s guardian.

Godparents are supposed to provide emotional and spiritual support to a child. A guardian, in contrast, is tasked with protecting and raising the child if their parents can no longer do so. When selecting a guardian, parents need to look at a potential candidate’s:

• Shared values
• Financial stability
• Parenting style
• Location and proximity to family
• Willingness to accept the responsibility

Each of these elements can affect how a child grows up if the guardian must step in. Another important step is naming a backup guardian known as a conservator. Life circumstances change. The first choice may not always be able to serve. A conservator provides an additional layer of protection. The difference between the two is that a guardian is responsible for the child’s daily care and upbringing, while a conservator manages financial assets on behalf of the child.

In some situations, the same person may serve in both roles. In others, parents may prefer separate individuals so financial management remains independent. For parents in Farmington Hills, Michigan, taking time to consider these decisions helps ensure children are raised by someone parents trust.

Managing Your Child’s Inheritance And Michigan UTMA

Another key part of protecting minor children involves planning how they will receive financial support. Under Michigan law, minors generally cannot directly control property or financial accounts. Because of this, estate plans rely on trusts or custodial accounts. One commonly used law is the Michigan Uniform Transfers to Minors Act (UTMA).

UTMA accounts allow parents or relatives to transfer assets to a child while assigning a custodian to manage the funds until the child reaches adulthood. However, once the child reaches the legal age defined by the account, they receive full control of the funds.

Some families prefer a trust because it offers additional flexibility. A trust allows parents to set staged distributions rather than transferring everything at once. This structure may support:

• College education
• First home purchases
• Career development
• Long-term financial stability

A trust can also appoint a trustee who manages investments and distributes funds according to the parents’ written instructions. Combining trusts, UTMA accounts and other estate planning tools enables parents to help ensure the financial resources can support their child in meaningful ways as they grow.

The Ultimate New Parent Legal Checklist

Estate planning includes several steps. The following checklist highlights the key legal and financial actions new parents should consider when protecting minor children:

• Name legal guardians: Choose the individuals who would raise your children if both parents pass away. This designation should be documented in your will.
• Create a will or trust: A will names guardians and outlines asset distribution. A trust can manage inheritance for children and avoid probate delays.
• Establish a financial power of attorney: This document appoints someone to manage finances if you become incapacitated.
• Set up health care directives: These documents allow someone you trust to make medical decisions if you cannot communicate your wishes.
• Update beneficiary designations: Review life insurance policies, retirement accounts and investment accounts to help ensure your child is properly included.
• Purchase life insurance: Life insurance helps replace income and provide financial support for your child’s future needs.
• Consider a living trust: A revocable trust allows assets to pass to children in a controlled way without court involvement.
• Inventory assets, digital accounts and debts: Create a record of bank accounts, real estate, credit accounts and digital platforms such as social media or cloud storage.
• Document important locations: Keep track of where important documents are stored, including birth certificates, Social Security cards and insurance policies.
• Review employer benefits: Workplace benefits such as flexible spending accounts (FSAs), health savings accounts (HSAs) and legal plans may support family financial planning.
• Create a letter of instruction: This personal document provides guidance on your child’s routines, preferences and care needs.
• Sign a Michigan-specific power of attorney: Make sure documents comply with Michigan law to help avoid complications later.

Completing these steps creates a strong legal framework for protecting minor children and organizing family finances. You can also download the full printable checklist to bring to a consultation to make sure each item is properly addressed.

Your Family’s Future Starts With A Plan

Estate planning allows parents to take meaningful steps toward protecting their children’s future. Naming guardians, organizing finances and creating trusts enables families to have their wishes documented and makes sure that children receive the support they need as they grow.

At Brown Borkowski & Morrow, we work with families throughout Farmington Hills, Michigan, who want to create practical estate plans that support their children and protect what they have built. If you are ready to begin estate planning for your family, you can complete the contact form or call us at 888-757-1681 to schedule a consultation. We look forward to helping you put the right protections in place for your family’s future.