I’m Young and Don’t Have Many Assets, Do I Need an Estate Plan?
I have bad news for you: young people die. Death, unfortunately, isn’t reserved for the elderly. While we tend to think of Estate Plans, Wills and Trusts as things for old people, it’s just as important for young people – especially young parents – to plan for their death too. You may think, “well I don’t have any assets, why would I need an Estate Plan?”
Here is why:
- Who will oversee making medical decisions for you, if you can’t? A healthcare directive is set up now, to make sure, if the time comes that you can’t make your own decisions about your healthcare, your wishes are known and someone is designated to act and speak on your behalf. This can save your surviving loved ones a lot of heartache and stress about making difficult decisions.
- Who will oversee your financial affairs?
With an Estate Plan, you will assign an Agent or Trustee to manage your final financial affairs. This should be someone you trust and who is responsible enough and willing to carry out your final wishes. Their duties would include paying your bills when you are sick, collecting all your assets, paying off your debts (through your estate), determining the value of your holdings, distributing assets and if necessary, hiring an attorney.
- Who will care for your minor children? For young families, this may be the single biggest reason for an Estate Plan. If one parent dies, the surviving parent will raise the children (unless they are physically or emotionally unable). But what if you both die? In that case, the court will appoint a guardian, without knowing your wishes. If you want to ensure your crazy father-in-law doesn’t get your children, you will need a plan that clearly states WHO will get guardianship of your children
- What happens to your savings and investments? Make sure you have beneficiaries designated on your retirement and investment accounts. And make sure they are current! In a Forbes article, Young People need Estate Plans too, they advised, “add beneficiaries to your bank account, by asking the bank for a POD (payable on death) form. A will can take a while for the court to process, but with beneficiaries, your heirs just need to show up with a death certificate and some form of ID and they can get immediate access to your accounts.” However, this does NOT work if you heirs are under 18, and even at the legal age of 18, they may be poor money managers. A trust will solve this problem by holding money for your children, to take care of them until they are older and, hopefully, more responsible.
- Life Insurance may be your biggest asset. Even if you don’t have a big estate, it’s crucial to have a life insurance policy large enough to pay off your debts, educate your children, and provide living expenses for those you leave behind. Often your living trust will be the beneficiary of your life insurance policies.
- Who gets your prized possessions? In times of duress, people can become angry and bitter. Save parents, siblings, children and your spouse from having to fight over your sentimental belongings. Put in writing who gets what. You will save them from a lot of stress by doing so.
- What will happen to your Social Media accounts? In the grand scheme of things, this may not seem like a big deal. But imagine your social media accounts ending up in the hands of a bitter child or an estranged spouse, upon your death. You wouldn’t want just anyone posting on your behalf while you’re alive – and you certainly wouldn’t want just anyone “speaking” and posting on your behalf when you’re gone. Make a list of your accounts, logins and passwords and make it clear who you want to handle those accounts – and how you want them handled – when you no longer can. While you’re at it, provide online banking information to your spouse, agent, executor and/or successor trustees as well.
Tragedy can strike anyone, at any time. Be sure your family is protected. Get your Trust or Estate Plan in order today. Contact us for no-obligation consultation. We’re here to help.