There is no magic age for creating an estate plan.
Perhaps you are reading this and are retired.
Maybe you have just turned 18 and achieved legal status as an adult.
You maybe you are somewhere in between.
According to a recent Reality Biz News article titled “When is the right time to consider estate planning?,” you will need an estate plan anytime after you reach adulthood.
Although the average life expectancy for an American is between 80 and 85, you are not guaranteed this many years.
Prince or pauper, death does not discriminate based on age.
As my grandfather said, “the old must die and the young may die.”
By failing to create an estate plan, you will be taking unnecessary risks for you and your loved ones.
Creating a plan before a crisis is much simpler than running damage control after a tragic occurrence.
Even if you are young and have few personal assets, you still have yourself.
Incapacity planning will still be essential.
Although every adult should have an estate plan regardless of age, certain circumstances make an estate plan even more important.
What are these?
You have a savings account.
Often savings accounts hold at least a few thousand dollars.
Some hold even greater amounts.
Whatever the sum, you will want to ensure the right person inherits these funds when you die.
It may be as simple as arranging with the financial institution to have the account “pay on death” to a designated beneficiary.
This simple arrangement will avoid probate as long as that beneficiary is an adult who is alive and is not incapacitated.
You have recently been married.
While some people continue to get married at a young age, others are waiting until they have established careers before tying the knot.
With the prevalence of divorce, remarriages are also common.
Whether you are recently married or remarried, you will want to take steps together to determine who will receive your separate and your joint assets.
If you have been divorced, an estate plan review and update allows you to remove your ex-spouse from your estate planning legal documents and beneficiary accounts.
If you are married and do not have any estate planning documents, then your current spouse will likely receive a bulk of your estate or your estate in its entirety.
There are exceptions when it comes to non-probate assets.
For example, whoever is named as the beneficiary on payable-on-death account will receive the assets immediately.
You have a large estate.
Do you have a sizable estate?
If so, you may have more tax considerations in your estate plan.
Working with an experienced estate planning attorney can help you create a tax-efficient plan.
In many instances, this will involve incorporating a trust into your estate plan.
You want to travel.
Travel comes with risks at any age, especially if you have minor children.
If something were to happen to you while you were away, you would want to ensure your children are under the care of a guardian who shares your values.
By naming a guardian in your last will and testament, you can travel with the knowledge your children will be in capable hands if something untoward were to happen to you and your spouse.
You own property.
Do you own a car, a house, a boat, or real estate?
If yes, you should provide for their efficient disposition in your estate plan.
Doing so will allow you to leave these assets to someone of your choosing.
Although certain situations are associated with greater risk, estate planning is essential at any age.
Reference: Reality Biz News (April 23, 2021) “When is the right time to consider estate planning?”