The popular website Caring.com has been conducting estate planning preparedness surveys on an annual basis for the last few years. They should be releasing a 2023 version soon, but until then, we have to work with last year’s figures.
Estate Planning Preparedness Among Millennials
In 2022, 24 percent of people in the 18-34 age group had wills or trusts, and this is a decrease year over year. Just 27 percent of individuals between 35 and 54 years of age had estate plans in place a year ago.
Gen Y members are in these groups because millennials are now between 25 and 40 years old. You may say that estate planning is not important for these young adults, but there is a dimension that you may be overlooking if you feel this way.
Parental Responsibilities
The parents of minor children are typically in their 20s, 30s, or 40s, and these are the millennials. When you have a child depending on you for everything, you are being irresponsible if you go through life without an estate plan.
You owe it to your family to take the right steps to make sure that they will be provided for if something catastrophic happens to you.
Nomination of a Guardian
Who would care for your child if both parents were gone? Would you want a court to decide, or would you rather make the decision yourself?
These are profound questions, and everyone would say that they would rather make their own choices, but most of them have not done so. If you are in this position, you can nominate a guardian for your child or children in a simple will.
The court would still be involved, but they would examine the facts and approve your nominee unless there was some reason why the individual was deemed to be unfit.
Financial Considerations
Income replacement is a key consideration when you are planning your estate as a millennial with a family. You can purchase the appropriate level of life insurance, and term life is affordable for younger adults.
There is also the matter of money management on behalf of the minor child. A revocable living trust is a very effective estate planning tool for people of all ages, so this can be the right choice for Gen Y members.
You would act as the trustee while you are alive and well, so there would be no loss of control of the assets. In the trust declaration, you name a trustee to succeed you after your passing.
After your death, the trustee would manage the assets on behalf of the children if they are not adults. If your children are adults at the time of your passing, the trustee would distribute assets to them in accordance with your stated wishes.
We should point out the fact that a married couple can create a joint living trust, and the partners would act as co-trustees. This can be an efficient way to proceed if there is a good bit of community property and the individual spouses intend to leave their respective interests in the property to one another.
Incapacity Planning
An estate plan for a millennial, or anyone else for that matter, should include an incapacity component. You can state your life support preferences in a living will, and you can add your organ and tissue donation choices.
A durable power of attorney for health care can be added to name a decision-maker to act on your behalf with regard to medical matters that are not related to life-support utilization. To give this individual access to your health records, you should include a HIPAA release.
For financial decision-making, you can name a disability trustee if you have a living trust. To account for the management of assets that are not held by a trust, you can execute a durable power of attorney for property.
We Are Here to Help!
Today is the day for action if you are going through life without estate plan. You can schedule a consultation at our Oklahoma City estate planning office if you call us at 405-843-6100, and you can use our contact form if you would rather send us a message. We now have a Tulsa location as well, and the number there is 918-615-2700.
After helping his own family deal with a lengthy probate and the IRS following his father’s untimely death in a farm accident, Larry Parman made a decision to help families create effective estate plans designed to reduce taxes, minimize legal interference with the transfer of assets to one’s heirs, and protect his clients’ assets from predators and creditors.