Young adults tend to neglect thinking about their estate plan in lieu of their careers, lifestyle, or other endeavors. Thinking about planning your estate at a young age may seem morbid or untimely, especially for those who are single or may not have much by the way of assets, but that is a common misconception.
Young adults can greatly benefit from creating an estate plan. If you pass away unexpectedly, you will want your family or loved ones to be taken care of, first and foremost. Even if you live a long life, it’s best to start thinking about your estate plan now. By having strong foundations in place regarding your estate plan, you can build upon it over time. The following are some of the main benefits of creating an estate plan even at a young age.
To protect your family
It is important that you have documentation in place that specifies whom you want to administer your estate and inherit your assets, as well as raise your children in the event you die and have minor children. An estate plan will ensure that your children will be raised properly and financially looked after in their childhood and beyond. You may also want to create trusts for them so that the funds can be used to pay for something that is beneficial for them, such as college, buying a home, or starting a business. You may also want to plan for children that have specific needs, such as children with disabilities, adverse health conditions, addictions, among other considerations. An effective estate plan can help you address these important decisions.
To protect your assets from probate
Without a formal estate plan, when you pass away there is a reasonable likelihood that all or part of your estate will go through probate proceedings. Probate often takes long and the fees can be expensive, even for estates that may be considered “modest” or “normal.” By creating trusts and putting in estate planning strategies, you will be able to effectively protect your assets from the probate process, and in turn allow those who will administer your estate to do so more efficiently.
To protect yourself
All too often young adults fail to plan for their own wellbeing in the event they become incapacitated or end up with adverse health conditions. Instead, they tend to focus their attention on their professions and financial wellbeing. A complete estate plan will allow even young and healthy adults to prudently plan for their own health care desires and needs, in the unfortunate event they become incapacitated. This will also allow young adults to make arrangements for those they trust to manage their financial affairs in the event they are unable to do so themselves. Ironically, all of the hard work young adults put into their profession and financial wellbeing could be at risk without an estate plan to address these scenarios.