Boomers and Millennials Both Need Estate Plans
It doesn’t matter how old you are—you need to have an estate plan. It’s part of being a responsible adult.
One reason to have an estate plan is to articulate how you want your possessions, including real estate, investment accounts and personal effects, to be distributed after you die. But that’s not limited to people over 40, warns CBS Boston’s article, “The Boomers’ Kids: Estate Planning.”
Remember, for those of you who are under 40, dying isn’t a just phenomenon that occurs only to old people. Unfortunately, people die at all ages, and many young people think of this as something very far off in their futures. As a result, it can be an obstacle to completing this last piece of a financial plan.
If you chose to not sign a will, the state will make one for you based on the state’s probate laws. These laws stipulate who will get your assets when you die. If you’re married with young children and both parents die, the state will determine who will be the children’s guardian.
As you run through the scenarios in your mind, this might be just enough impetus to get you moving on your will. Do you really want to leave it to your cousin Helga and her goofy husband to rear your kids? If there is a sizeable life insurance policy to cash out, you can bet she’ll jump at the chance, even though you shudder to think of your kids in her care. Draft your will with a guardianship provision to avoid the chance of her getting that opportunity.
Your estate plan does not need to be complex, fancy, or expensive. Begin with that all-important will and designate an executor/executrix to carry out your wishes and distribute your assets. In your will, you should name a guardian, if you do have minor children. Speak with the person you’re considering to rear your children and ask them if they would take on that responsibility. Be sure that you know their values and their level of patience.
An estate plan also addresses serious issues that occur while you are still living that will protect you and those you love when hard decisions need to be made. A Durable Power of Attorney allows you to name someone who can act on your behalf for legal and financial decisions, if you are incapacitated by illness or injury. You also need a Health Care Proxy to designate someone to make medical decisions, if you are not able to. Talk with the people who you want to name in these roles and make sure that they are comfortable with what you are asking of them. Make sure they understand what you want when it comes to end of life decisions. Be sure that they are very clear that your own wishes need to supersede their opinions and that they will respect your opinions, regardless of the situation.
Reference: CBS Boston (June 9, 2017) “The Boomers’ Kids: Estate Planning”