- The Washington Times - Saturday, January 7, 2006

It’s time to get it together. It’s time to do your family’s financial and legal planning. It’s important to write a will, enroll in tax plans and start saving for college because your children are counting on you.

The will should come first, says Nihara K. Choudhri, a lawyer, mother and author of “Parent Savvy: Straight Answers to Your Family’s Financial, Legal & Practical Questions.”

“No one wants to think about the issues involved, and nobody wants to name a guardian. It’s emotionally difficult to handle, so they want to put it off as long as they can. But life really is unpredictable, and [if], God forbid, you die, you’re not making sure your child is protected if you haven’t done a will,” she says.

She adds: “You don’t want to leave raising your children to chance.”

Most people rely on informal understandings and agreements — and that’s not wise.

It’s what people do for their “in case of emergency” plans and for much more serious things, and, either way, a verbal agreement isn’t necessarily legally binding. A judge certainly isn’t going to base a custody decision on a he-said-she-said conversation.

Mrs. Choudhri, who could have written her own will, didn’t do it for a year after her son was born. “My parents would’ve stepped in, and my in-laws, and maybe my brother-in-law and my sister,” she says.

The problem is that’s already too many people.

Guardianship isn’t a popularity contest, Mrs. Choudhri says, and parents shouldn’t worry as much about hurting someone’s feelings as they should consider who has the values most similar to their own. Ask yourself, “Who thinks most like me?” she suggests. That’s probably the person who would raise your children the way you would have done it.

A will also is important to set up the financial structure for your children.

Children will get everything a parent owns if details aren’t spelled out — even if that child is 2 years old, Mrs. Choudhri says. “You need a backup structure to manage the money for your child. Your child’s life will be so complicated if you die, you don’t want to add to it.”

“Trusts are not just for rich people,” she says.

Parents generally have two options when it comes to managing assets, trusts or custodial accounts. Custodial accounts are popular, Mrs. Choudhri says, because they are inexpensive and easy to set up. Parents can open one at a bank or brokerage company in their state. A custodian manages the asset until the child reaches a certain age — usually 21.

A trust allows parents more control over an inheritance. Restrictions can be placed on how and when the trustee may spend a child’s assets (for educational purposes, for example), and the parent, not the state, sets the age at which the child receives the inheritance.

Mrs. Choudhri says she changed things in her life as soon as she finished each chapter of the book, which also covers child care, balancing work and family, and selecting doctors. The book was done in conjunction with Babycenter.com.

“After that tax chapter, I set up dependent care accounts,” she says with a laugh.

Until she did the research, she also didn’t understand how flexible health spending accounts worked, and she definitely didn’t realize that such an account could cover day-to-day drugstore purchases such as humidifiers and children’s Tylenol.

Another thing she has learned: Buy safe baby products.

“I’m a Columbia-educated lawyer and a pretty smart shopper, but I didn’t do the right research for purchasing decisions. I relied on friends’ recommendations, and I had ended up using a baby bath ring. I didn’t know a safety group had discovered flaws in it.”

Her suggestions? Look for the Juvenile Products Manufacturers Association seal of approval; read Consumer Reports reviews; read packaging to make sure the product is designed for your child’s age group; and find out if the product has been recalled. (Check the federal Consumer Product Safety Commission’s Web site — www.cpsc.gov — for that information.)

“We as parents, especially moms, spend so much time focusing on breast versus bottle, or letting them cry to sleep or whether we should pick them up. We don’t stop to think about the future, things like college savings plans. But that will affect the kids’ lives much more than whether they ate from the breast or bottle,” Mrs. Choudhri says.

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