If you’re like most millennials, estate planning is not high on your list of priorities. Paying off student loans, buying a first home and starting a family are more common concerns of those in their 20s and 30s. However, it is during this time in our lives that we begin to establish financial stability, acquire legitimate assets of our own and become responsible for people other than ourselves. Although no one likes to think about things like death and disability, planning for these events ahead of time will protect the people you love and reduce the burden on them during a difficult time.
Generally speaking, estate planning is the process of organizing your affairs so that in the event you are unable to care for yourself, or you have passed away, your finances are in order and arrangements are made to care for your loved ones. There are a variety of tools available to achieve these goals, but one of the most fundamental and useful for millennials is a testamentary will. A will is a legal document that sets forth your wishes regarding the distribution of your property and care of any minor children.
In the event that you die without a will (or other similar instrument), the disposition of your property will be determined by the court. This means that your assets may potentially end up in the hands of someone other than who you intend. These days, many millennials are involved in committed romantic relationships, but put off marriage or avoid it all together. While marriage creates default rules that give spouses a legal entitlement to your property, unmarried partners have no such right and will be left with nothing in the event of your death. In Idaho, even if you are married your estate may be split between your spouse, parents or your children in ways that you may not have foreseen. The creation of a will allows you to spell out how you want to divvy up your property and assets in the manner of your choosing.
For millennials that have children, a will allows you to designate a personal guardian who will care for your children when you are gone. If this issue has not been addressed before you die, the court could make the decision and the resulting guardian may not be who you would have intended if the choice was yours. Frequently, parents opt to include a trust to be administered along with their wills naming their children as the beneficiaries. The creation of such a trust allows you to provide further instruction on how to tend to your children’s financial needs as they grow.
Millennials are the first generation to grow up online. As a result, many have amassed a number of digital assets. Some digital assets such as cryptocurrencies, online financial accounts and airline points have significant worth. Other digital assets, such as social media accounts, photos and videos have sentimental value and should be preserved or appropriately shut down. Do you want revenue generating assets be transferred to people who can continue to manage them or should cash values be redeemed? Should social media webpages be deleted or updated memorial page? A properly drafted will should include instructions in accordance with your wishes along with a separate list of account names, passwords.
As the old saying goes, in this world nothing is certain, except death and taxes. With that in mind, a simple estate plan can ease the burden of both, regardless of how much stuff you have or how old you are. While it may sound like an exhausting process, in truth, you don’t need much to start planning.