Historically, estate planning has been viewed as a service for the elderly to get their assets and money in order before they’re gone. The thinking is you don’t really need to think too far ahead when you’re younger, but we’re finally reaching a point where more and more young people are getting involved in the process.
Estate planning is for EVERYONE. Adults at any point in life should be planning their estate because we simply cannot always plan for what life throws at us. We wish a long, healthy, and prosperous life for everyone but it’s important to understand this isn’t always reality.
Today, we want to help you understand how your age could impact your plans and where you should be with planning at various moments in your life.
Single young adult
At this point in your life, you’re likely first starting to make real money and acquire assets. Your plan will likely be simple barring certain circumstances.
The biggest aspect of a young adult’s estate plan will be incapacity planning should you become medically unavailable and need decisions made for you. This includes medical and financial decisions. You’ll want to assign someone who can make those decisions for you which, at this age, could very well be your parents or a sibling.
If you have significant assets but haven’t started a family, you may consider donating your assets to a cause you care about. Ultimately, single young adults are likely able to use a will as a means to establish the early stages of their estate plan.
Young adult with a family
Once you start a family, your estate plan will start piling up. In this scenario, you’re going to want to make sure your spouse is included in your plan along with any children. You’ll need to have a guardianship plan for your children should you become incapacitated or die.
You’re also going to need to be considerate of how you allocate your assets. It’s natural to want to leave them to your children, but you’ll likely need to have contingencies in place should you pass away before your children are old or mature enough to acquire assets. In this case, a trust will likely be your best option to put certain parameters around the transfer of assets.
Middle-aged
You’re likely going to see your children grow into adults during your 40s and 50s. At this point, you’re going to want to alter your plans as your adult children are more able to acquire and manage assets from your will. You may also need to consider your children’s spouses should they get married in these years.
Another major factor during these years will be retirement planning. You’re old enough to be well on your way to funding retirement, so you should plan around this. Will you need to retain more assets for yourself to make sure you can fully enjoy retirement?
By now, you could have quite a real estate portfolio built up. If this is the case, you’re going to want to make sure you include each property and instructions for that property in your will. Even if you’re buying and flipping homes, you should update your plan accordingly.
Retirement age
When you reach retirement age, your plan should be pretty set. You should have a good plan for all your assets including distribution and retention for retirement purposes. A Medicaid trust could also be imperative in these years, as you’ll want to place assets you plan to distribute to beneficiaries in this type of trust in order to avoid being disqualified from Medicaid benefits.
Ultimately, your later years should focus on any minor tweaks to your estate plan as necessary when family, financial, asset, and health changes take place. This includes adding new members to the family or taking off members of the family who predecease you.
Regardless of where you are in life, you should have an estate planning attorney you know and trust by your side. At the Law Offices of Ray Garcia, we can help you craft the right plan for your situation. Contact our offices today and get your plan underway.
Law Office of Ray Garcia, P.A.
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