Estate Planning: A Decade by Decade Primer
Three Pearls Of Wisdom
Every adult should pay attention to three pearls of wisdom about estate planning. First, you are never too young to start formalizing decisions about your future and the legacy you will someday leave behind. Second, you are never too old to revisit the decisions you previously made and make changes based on evolving state and federal laws and changing circumstances. And third, estate planning is for everyone, not just those who are wealthy or well-to-do.
In Your 20s
Young adults in their 20s just starting their first full-time jobs may feel as though their assets and responsibilities don’t justify a need for long-term planning. But many aspects of their lives can and should be considered in the event of future incapacity. Most people have strong opinions about the person they would like to make medical and financial decisions on their behalves if they are severely injured or debilitated by illness. Becoming familiar early with powers of attorney, patient advocate designations (or health care powers of attorney), wills and other estate and disability planning instruments can provide a lifetime of peace of mind.
In Your 30s
Americans have increasingly delayed marriage and parenthood until they reach their 30s, but once they inhabit those roles, it becomes extremely important to create a will and dictate how property, insurance proceeds, important possessions and other assets will be distributed in the event of an untimely death. Perhaps more importantly, a clear indication of guardianship preference in the event of death or incapacity will help you protect your children’s futures.
In Your 40s And 50s
As you grow older and wiser, so hopefully does your financial portfolio. In your 40s and 50s, you may begin to consider using alternative instruments such as pour-over wills and marital or joint trusts to exclude assets from the probate process, minimize estate taxes, and help your future heirs better manage the benefits you intend for them to enjoy. Just as important, events such as divorce, remarriage, career changes, an inheritance you yourself received, and other factors may require you to amend or revoke earlier decisions to fit current circumstances.
In Your 60s
One of the benefits of an early start to estate planning is that it helps you make smart financial decisions when you have the longest opportunity to benefit from them. Approaching retirement, you may want to have protections in place, such as long-term care insurance, to protect your assets from early depletion. As many people reach their 60s, they also begin to consider how the wealth they have protected can serve charitable purposes for decades to come.
Your 70s And Beyond
An increasing number of Americans lead productive and active lives well past their 70s. But one key to elderly peace of mind is a solid and relevant estate plan that continues to serve changing needs. Health issues can affect whether you continue to own a family home, and a wide variety of factors should be considered to maintain financial stability, from reverse mortgages to gifting of assets to children.
Basic decisions like funeral planning and updated health care directives may not always be easy to discuss, but the value of forethought about these issues is hard to underestimate. While it is easy to hope for the best, it is often hard to plan for the worst.
Trusting An Estate Planning And Probate Attorney
Whatever challenges and benefits life grants you through decades of adulthood, a dedicated counselor who understands your past and anticipates your changing needs is a great asset. By documenting your wishes at each stage of life, you can build a secure foundation for your family’s security, prosperity and enduring success.