The millennials, or “Generation Y,” are now between 25 and 40 years of age. According to a survey that was conducted by Caring.com, less than 30 percent of Americans in this age group have estate plans in place.
Obviously, people do not usually pass away when they are in their 20s, 30s, or 40s, but it does happen each and every day. If you are in this group and you want to take a gamble as a single person, you may not be risking much, but the situation is very different for people with families.
Child Guardianship
You should address the matter of child guardianship if you are a millennial that is devising an estate plan. A nominee can be named in a simple will, and if you take this step, you can go forward with peace of mind.
Financial Security
Most young married individuals contribute financially to their families, and a loss of one income could have a devastating impact. You should think long and hard about this possibility, and it should motivate you to take action if you are going through life without an estate plan.
Clearly, most young people are not wealthy, but you can utilize life insurance to serve as an income replacement vehicle. Term life insurance premiums are based on your age, and they are surprisingly inexpensive for millennials because the risk to the company is minimal.
Your estate plan should include an asset transfer vehicle like a will or a living trust. If you utilize a living trust, and you would act as the trustee while you are living, you would name a successor to administer the trust after your death.
The successor trustee would be able to manage assets for a beneficiary that is a minor until they reach adulthood. We should point out the fact that a married couple could jointly create a shared living trust, and they would act as co-trustees.
It is possible to account for this dynamic if you have a simple will through the inclusion of a testamentary trust. This type of trust would be created after your death, and once again, the trustee would be able to administer the trust for a minor that cannot handle their own money.
Incapacity Planning
An estate plan for millennials should address the eventualities that you may face if you are in a life-threatening or terminal condition, and cognitive impairment should be added to the list.
If you do nothing to prepare for incapacity, the state could step in and appoint a guardian to act on your behalf. You would become a ward, and this is not a very pleasant prospect.
You can empower your own representatives in advance if you execute documents called durable powers of attorney. The “durable” qualifier is operative because it will allow the power of attorney to remain in effect in the event of your incapacity.
We are using the plural because you need two powers of attorney: a power of attorney for property, and a power of attorney for health care or health care proxy. You can use the same person to act as the agent for both purposes, but this is not a requirement.
A piece of legislation called the Health Insurance Portability and Accountability Act (HIPAA) was enacted in 1996. Because of a provision contained within it, doctors cannot reveal medical information to anyone other than the patient.
As a response, you should include a HIPAA release to give your health care representative the freedom to discuss your condition with your doctors, and there is another step to take. You should add a living will to state your life support utilization preferences because this is a very personal decision that you should make for yourself.
With regard to financial decision-making, if you have a revocable living trust, you can name a disability trustee to step into the role if it ever becomes necessary.
Schedule a Consultation Today!
Our doors are open if you are ready to work with a Glastonbury or Westport, CT estate planning lawyer to put a plan in place. We can gain an understanding of your family dynamic and your concerns and help you develop a plan that puts your mind at ease.
You can schedule a consultation appointment right now if you give us a call at 860-548-1000, and you can use our contact form if you would prefer to send us a message.
Mr. Florin is admitted to practice before the courts of the State of Connecticut and the State of New York. He is also a member of the American Academy of Estate Planning Attorneys, the National Academy of Elder Law Attorneys, the Connecticut Bar Association, and the Fairfield County Bar Association.