Having a baby changes your priorities fast. All of a sudden, you are thinking about things you never used to think about. Who would take care of your child if something happened to you? What would your child live on? Who would manage the money?
These are estate planning questions, and most new parents in Arizona have not answered them yet.
This is not a topic most people want to dwell on. But setting up the right plan now is one of the most practical things you can do for your child. It is not about being morbid. It is about making sure someone you trust is in charge if you are not.
Here is what new parents in Arizona need to know, and what to do about it.
Why New Parents Cannot Wait on This
If you have a child and no estate plan, Arizona has already made one for you. You just did not write it.
If both parents die without a will, a judge decides who raises your child. That judge does not know your family, your values, your relationships, or your wishes. They make a decision based on what they can determine from a probate proceeding, and the process takes time your child cannot afford.
If you have a life insurance policy or a retirement account and your child is named as the beneficiary, that money cannot go directly to a minor in Arizona. The court will appoint a conservator to manage those funds – again, without any input from you – until your child turns 18.
At 18, your child gets it all in one lump sum, whether or not they are ready to handle it.
The right estate plan gives you control over all of this. Modern Law’s article on what happens if you die without a will in Arizona covers the full consequences of going without a plan.
The Most Important Thing New Parents Must Do: Name a Guardian
A guardian is the person who raises your child if both parents die or are unable to care for them. In Arizona, the only place you can legally name a guardian for a minor child is in a will. A trust cannot do this. A beneficiary designation cannot do this. Only a will.
Without a named guardian, the court decides. And while judges try to make good decisions, they cannot know what you know about your family, your siblings, your friends, and who would actually be the right person for your child.
How to choose a guardian – things to think through:
- Who shares your values and parenting philosophy?
- Who has the emotional capacity and time to raise a child?
- Is the person’s living situation stable? Do they have space?
- If you have more than one child, would this person raise all of them together?
- Is the person willing? Have you actually asked them?
- Do you want the same person handling money as raising your child? (These can be separate roles.)
You can name a guardian of the person (who raises your child) and a guardian of the estate (who manages money for your child) separately. Many families split these roles intentionally – someone who is great with kids does not always have strong financial judgment, and vice versa.
Name a backup guardian too. If your first choice becomes unable or unwilling to serve, a backup ensures a judge does not have to choose from scratch.
What Happens to Money Left to Your Minor Child?
This is where a lot of new parents get caught off guard. In Arizona, minors cannot legally own significant assets directly. If you name your child as a direct beneficiary of a life insurance policy, retirement account, or your estate, and the value exceeds a small threshold, the court will get involved.
Here is what that looks like without a plan:
- You die, leaving $500,000 in life insurance to your child directly
- The insurance company cannot pay a minor
- A court proceeding is required to appoint a conservator (possibly someone you never would have chosen)
- The conservator manages the funds under court supervision, with regular reporting requirements, until your child turns 18
- On your child’s 18th birthday, they receive the full amount with no restrictions
An 18-year-old receiving a large sum with no restrictions is rarely the outcome parents wanted.
The solution: a children’s trust.
A trust allows you to control exactly how and when your child receives money. You can specify:
- Funds are available for education, health, and living expenses at any age
- A portion of the principal is released at age 25, another portion at 30, and the balance at 35
- The trustee has discretion to distribute funds for your child’s specific needs
- If your child struggles with addiction or financial management, a spendthrift provision protects the funds from creditors
A living trust with a children’s sub-trust accomplishes all of this. For the full picture of what a trust covers versus what a will alone does, see Modern Law’s Will vs. Trust guide.
The Core Documents New Parents Need
Here is the minimum estate plan every new parent in Arizona should have in place. The 7 documents every Arizona estate plan should include covers each of these in detail.
| Document | Why New Parents Need It |
| Will | Names your child’s guardian – this is the only document that can do this |
| Revocable living trust | Holds assets for your child, controls when and how they receive money, avoids probate |
| Pour-over will | Safety net that catches any assets not yet in the trust |
| Durable power of attorney | Names someone to manage your finances if you are incapacitated |
| Healthcare directive | Documents your medical wishes so your family does not have to guess |
| Mental healthcare power of attorney | Covers psychiatric care decisions |
| Updated beneficiary designations | Ensures life insurance and retirement accounts go where you actually want them |
If you only do one thing today, do this: update the beneficiary designations on your life insurance and retirement accounts so they go to your trust (not directly to your child), and write a will that names a guardian.
Life Insurance: How New Parents Should Handle Beneficiary Designations
Most new parents have life insurance, or they get it soon after having a child. How you designate the beneficiary matters enormously.
Do not name your child directly as beneficiary. As explained above, a minor cannot receive life insurance proceeds directly. Court involvement and a court-appointed conservator will follow.
Better options:
- Name your living trust as the beneficiary. The funds go directly into the trust and are managed according to your instructions for your child.
- Name your spouse as primary beneficiary and your trust as contingent beneficiary. This covers the most common scenario (one parent survives) while protecting against both parents dying together.
The same logic applies to retirement accounts (401k, IRA) and any other assets with a beneficiary designation.
Planning for Both Parents – What If Only One of You Dies?
Most couples only think about what happens if both parents die. But statistically, it is much more common for only one parent to die, at least initially.
Make sure your plan addresses both scenarios:
If only one parent dies:
- Does the surviving spouse automatically have full control of all shared assets? Check your title and beneficiary designations.
- Is there a durable power of attorney naming the other spouse to manage financial accounts immediately?
- Are there any assets that would trigger a probate even if one spouse dies?
If both parents die:
- Who is the named guardian? Who is the backup guardian?
- Are your assets in a trust that will hold and manage funds for your child?
- Who is the trustee managing the money? This can be the same person as the guardian or a different person.
Community property with right of survivorship under ARS Section 33-431 is a simple way for married Arizona couples to make sure real property passes to the surviving spouse immediately without probate. It also gives a valuable step-up in tax basis.
Do Not Forget Your Home
Your home is probably your largest asset. Without a plan, your Arizona home will go through probate after your death. For most metro Phoenix, Scottsdale, and Tucson homeowners, the home is already above the $300,000 threshold for simplified probate.
Two clean options for new parents:
- Put your home in your living trust. Once the home is titled in the name of your trust, it passes to your beneficiaries without probate, according to your trust’s instructions.
- File an Arizona beneficiary deed. Under ARS Section 33-405, you record a deed that transfers the home to a named beneficiary at your death without going through probate. Modern Law’s article on getting a beneficiary deed in Arizona covers this option in full.
For a full strategy on keeping your estate out of court, see how to avoid probate in Arizona.
What About Single Parents?
Single parents have all of the same needs as married couples, plus a few additional considerations.
Guardian nomination is even more critical. If the other biological parent is alive, that parent generally has the first right to custody under Arizona law. But if they are not in the picture, or if both parents die, your named guardian becomes the deciding factor.
A trust is especially important. Without a second parent to manage assets for your child, a trust is the most reliable way to ensure someone you chose is managing money for your child’s benefit, under the rules you set.
Your financial picture needs attention now. Make sure your life insurance beneficiary designations, retirement accounts, and any real estate are all set up to move efficiently to your trust without probate delays. Consider what estate planning costs in Arizona and budget accordingly – it is far less expensive than the alternative.
When Should New Parents Get Their Estate Plan Done?
Before the baby arrives is ideal. Realistically, within the first few months of your child’s birth is fine. Do not wait until your child is in school, or until “life slows down.” It rarely does.
Review your plan after any of these events:
- Another child is born
- You and your co-parent separate or divorce
- Your named guardian’s circumstances change significantly
- You buy a new home or acquire significant new assets
- A named beneficiary or trustee dies
- Your financial situation changes significantly
An estate plan is not a one-time task. It is something you revisit as your life changes.
Frequently Asked Questions
Can I name a guardian in my trust instead of my will?
No. In Arizona, only a will can nominate a guardian for a minor child. This is why even families with a complete trust package still need a will.
What if my child’s other parent and I disagree on a guardian?
You can each name different guardians in your respective wills. If both parents die simultaneously, a court will determine the appropriate guardian, taking your wishes into account. Having an honest conversation with your co-parent about this is worth the effort.
Should my child be a beneficiary on my life insurance?
Not directly. Minor children cannot legally receive life insurance proceeds in Arizona without court involvement. Name your living trust as the beneficiary and let the trust hold and distribute funds for your child according to your instructions.
What happens to my child if I become incapacitated (but do not die)?
Your durable power of attorney lets someone manage your finances. Your healthcare directive covers medical decisions. If you have minor children and no living co-parent, talk to your estate planning attorney about whether additional guardianship provisions make sense for your situation.
How much does an estate plan for a new parent cost in Arizona?
A complete plan – trust, will, powers of attorney, and healthcare directive – typically runs $2,500 to $6,000 for a couple in Arizona. See how much estate planning costs in Arizona for the full breakdown.
Your Child Deserves a Plan
The whole point of estate planning as a new parent is simple: you want someone you trust raising your child, and you want money available to support them, managed the way you would manage it.
None of that happens automatically. You have to put it in writing.
Modern Law’s Arizona estate planning attorneys help new parents build complete plans that cover guardianship, trusts for minor children, property transfer, and incapacity planning. The process is more straightforward than most people expect.
Take care of your family before something happens. Start the conversation with Modern Law today.
Legal Disclaimer: This blog is for informational purposes only and does not constitute legal advice. Arizona laws change frequently. Please consult a licensed Arizona estate planning attorney for guidance specific to your situation.
