Estate Planning for Millennials

Estate planning plays a significant role in our lives, yet today, many youths have no estate plan whatsoever. 

It is never too early to being drafting out the basic estate plan.  Below is a summary of what young adults should know, even if their highest earning years are still ahead.

• Know your beneficiary designations. A young professional will likely have access to a retirement plan at work, and may have an individual retirement account.  It is important that they are revisiting who is listed as a beneficiary on each account.
• Talk about life insurance. Coverage through the workplace may not be enough to sustain a surviving spouse and children.  If you are on the path to marriage and children, think about individual life insurance policies, ideally term coverage.
• Create a health care proxy and power of attorney. “For singles, it’s even more important to consider who’s going to have your health care power of attorney.  Even a plain old power of attorney is very valuable.  You don’t have to be about to die to have one.”
• Draft a will. If you do not have a will, your estate is subject to state intestacy laws and the estate could be settled in a manner you never intended. 
• Discuss estate taxes. Even if you are too young to consider creating a trust, it is a good idea to be informed about the local tax environment. 

See Darla Mercado, Don’t Ignore Estate Planning for Millennial Clients, Investment News, Dec. 3, 2014.

Special thanks to Tom Weede for bringing this article to my attention.