Many young people incorrectly assume that estate planning is just for the elderly or the very wealthy. But no matter your age or net worth, it is important to have a basic estate plan in place. Estate planning is more than just having a will; creating an estate plan allows young people to distribute their assets and designate appointments, give back to charities, plan for their end of life, and specify their final arrangement wishes. Organizing your assets and health care wishes now can help avoid family conflicts and can prevent a large portion of your assets from going to the government later. This planning can save your family unnecessary expenses, hassle, and delays.
As millennials are living differently than the previous generations (getting married later or choosing to not get married, adopting pets, choosing to not have kids, and accumulating a large amount of digital assets) unique estate planning needs have developed. A comprehensive estate plan for the younger generation will take all of these considerations into account and will help guarantee millennials’ wishes are followed after they die.
Wills and Guardianship
Wills are arguably the most well-known estate planning document. Not only does a will allow people to distribute their assets and specify their final arrangements, wills also allow people to appoint guardians for their minor children. When you have young children, your life is not about you anymore. While no parent wants to think about dying and leaving a minor child behind, you must. If you have children, you should prepare a last will and testament as part of an estate plan as soon as possible, instead of assuming you are too young and have time to wait. In the event that you die as the parent of a minor child or lose the ability to care for your child, your will allows you to nominate someone to take on parenting responsibilities and act as the guardian of your minor children.
If you haven’t chosen a guardian in a legally enforceable manner, such as through a valid will, a court chooses for you and you have no way of controlling who they choose. While most people decide on a family member as their guardian, that may not always be the best choice. You may have to consider whether your child needs a different guardian, depending on their age. Beyond choosing a guardian, you also need to provide for your child’s financial, medical, and personal needs in the event of your death.
Estate planning documents also help take care of you while you are living. A power of attorney, healthcare proxy and living will are all documents that are referred to as advanced directives. These documents are used to indicate the individual or individuals that you are chosen to make legal, financial and medical decisions for you if you are unable to. While incapacitation could occur later in one’s life, the reality is that it is something that could happen at any age for any reason. In order to avoid the expenses, time and frustration that goes with the guardianship proceedings to appoint a legal guardian if you were suddenly incapacitated, one should include these documents in their estate plan even if they are young and healthy.
Likely the most famous U.S. case regarding health care decision making is the Terri Schiavo case. Terri Schiavo remained in an irreversible persistent vegetative state for nearly 15 years, while her spouse and her parents engaged in a lengthy legal battle regarding her medical care. Powers of attorney are critical documents, especially if you are not married.
If you are married and have young children, you need to take steps to ensure that your spouse and children are provided for. A revocable trust is often the best solution because a trust allows you to choose who receives your property and money, as well as the timing and size of the gifts the beneficiaries receive, and avoids potential creditor claims.
If you don’t yet have children or are choosing not to have children, you may have pets that you love and care for as if they were children. If so, consider pet trust which protects your animals if you can no longer provide care for them. The pet trust can specify a caregiver for your pet, provide care instructions, and set aside funds to care for the pet’s needs (medical care, grooming, exercise, etc.).
Millennials have typically amassed a larger amount of digital assets than members of previous generations. These assets may include social media accounts, blogs, photographs and videos, financial accounts, and email accounts. A comprehensive list of these of these assets, as well as the accompanying usernames and passwords, and instructions for their management, is essential to ensure that their wishes are honored if they pass away or become too ill to manage them on their own. Depending upon an individual’s wishes, a separate person can be appointed to wind up (or continue managing, e.g., in the case of a blog) these assets and accounts, or they can choose to have their executor or trustee handle this aspect of their estate. The list of digital assets can be incorporated into their other estate planning documents by reference.
Couples who live together outside marriage don’t enjoy the legal protections and benefits afforded to those who are married. With marriage comes a number of benefits including inheritance rights, tax benefits, Social Security and disability benefits, and insurance benefits. If you choose to remain unmarried and cohabitate, you can use an estate plan to give yourself and your partner some of the same protections and rights that married couples have. Even if you have a cohabitation agreement that addresses how you’ll split financial responsibilities and assets if you break up, these don’t cover the same extensive ground as a will.
For example, married couples have the right to make medical choices on behalf of each other should one of them become incapacitated. But if you’re living together and unmarried, neither of you has that automatic right. If your partner becomes ill, the right to make medical choices for them may fall to their parent, sibling, or someone chosen by a court. The only way to ensure you can make medical or financial choices for your partner and vice versa is by each of you creating advance directives that grant decision-making rights.
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It’s never too early to begin estate planning. No one knows what the future holds, but with a plan in place that provides for your own future needs and those of your loved ones, you can proceed with peace of mind. If you or a friend or loved one are considering estate planning for the first time, or are in need of updating an existing plan, please contact the attorney at Skillern Law Firm, PLLC by phone at 918-805-2511 or email@example.com. Feel free to also book an appointment with our firm using our Book an Appointment Online page!