Estate Planning for Those Under 40
We all live as if we have decades ahead of us, dealing with the present — we can't know the future. And that's why now is a great time to get a jump on estate planning. Do your family and loved ones know what accounts you have, where your financial information is and what your wishes are? Now is the time to tell them. If you start now, your plan will help keep your loved ones from becoming stressed if you suddenly become disabled or pass away.
You can begin to educate yourself about estate planning. For instance, what should you be looking for in an estate planning attorney? You can interview several to see whom you feel most comfortable with. You can explore estate planning strategies: Some organizations have free small-group events to share an understanding of the basics of estate planning.
You can start formulating how you'd want to be memorialized — how about creating a recording to share with your loved ones to help them by making the tough decisions in advance?
It's nice, also, to keep your accounts in order. Estate planning isn't just for wealthy people — you don't have to wait until you build up more savings. You may have a child or spouse who is financially dependent on you, so you don't what to ignore your estate plan.
- Designate beneficiaries.
- Designate a health care proxy to make medical decisions for you if you can't.
- Review asset titling — titling assets jointly with rights of survivorship is an easy way to ensure that your property passes to your heirs without delay.
- Consider establishing a trust — in many ways these can be even more effective tools than wills.
- Do some tax planning — although the federal estate tax affects only the wealthiest people, there are other tax issues, including state estate taxes.
- Select guardians to care for minor children.
- Plan ahead — an accident can result in an inability to make legal decisions; a durable power of attorney will name someone to act in your place if you are incapacitated.
Among the documents that are part of an estate plan, consider a will, life insurance and a power of attorney. You can think of a will as a road map outlining how your property will be distributed if you're disabled or die. Meet with an attorney and tell her or him what your assets are, who you want to leave them to and that you want it all to be simple.
In crafting a will, name a trusted friend or family member as the executor to help shepherd your estate through any court-supervised process, such as probate. You may want to seriously consider life insurance, particularly because you haven't accumulated lots of money yet. You'd want your family to have assets to live on. You can choose a less expensive option such as a term policy for a set number of years.
There are a lot of moving parts, and the earlier you get started, the more choices you'll have. Contact a professional today to explore the specifics of your estate plan.