Attorney
If you are young and healthy, you probably think of estate planning as something only older or ill individuals need to worry about. However, even if this is the case, it is still prudent to consider your estate planning needs. Engaging in estate planning is not about being pessimistic, but it is about being prepared. By setting up an estate plan now, you can ensure that your wishes regarding your assets, healthcare, and financial responsibilities are respected and followed in case of unforeseen circumstances. This planning can also reduce the burden on your family members during difficult times and help avoid potential conflicts or legal issues that could arise without a clear plan. It is about taking control and protecting your future, no matter how uncertain.
Reasons To Set Up An Estate Plan When You Are Younger
- Providing for Loved Ones: If dependents or family members rely on you, estate planning is crucial for their future security.
- Unexpected Incapacity or Death: While it is uncomfortable to think about, young people can face unexpected medical issues or accidents. Estate planning helps ensure that your wishes are known and followed.
- Making Your Wishes Known: Whether it is your medical care or the distribution of your assets, estate planning ensures that your wishes are documented and respected.
- Financial Responsibility: Starting the estate planning process when young instills a sense of financial responsibility and planning for the future.
- Guardianship of Minors: A properly drafted estate plan for young adults will ensure the right person is entrusted with their most precious valuable – their children. Young parents completing their estate plan can name who would care for their children and the assets left to their children if they should die untimely. Without proper documents in place to name the guardian, a court will make the decision.
Even if you don’t have many assets to worry about, estate planning is about more than just money—it is about ensuring your wishes are respected and your loved ones are taken care of, no matter what happens. It is a thoughtful, responsible step to take at any age.
Different Types Of Estate Planning Tools and Documents
You can do many things regarding estate planning, even if you are young and healthy. Things to do include the following:
- Creating a Will: A will is a legal document that dictates how to distribute your assets after death. For young people, creating a will is essential even if you don’t have significant assets, as it can also designate guardians for any minor children and ensure that your wishes are followed if something should happen to you.
- Establishing a Power of Attorney: A power of attorney (POA) is a legal document granting someone else the authority to make decisions on your behalf if you cannot do so. Decisions can be made regarding your finances, property, or healthcare. Establishing a POA when you are young ensures that someone you trust is in charge if you are ever incapacitated
- Setting Up a Healthcare Proxy or Living Will: A healthcare proxy (also known as a medical power of attorney) designates someone to make medical decisions if you cannot make them yourself. A living will, on the other hand, outlines your wishes for medical treatment and end-of-life care. Both are crucial for ensuring your documents align with your healthcare preferences.
- Considering a Trust: A trust is a legal arrangement where one person (the trustee) holds legal title to property for another person (the beneficiary). Trusts can help avoid probate, reduce estate taxes, and provide for the management of assets. They are not just for the wealthy; young adults might establish a trust to manage their assets in case of incapacity or to control how their assets are distributed after death.
- Beneficiary Designations: Certain assets, like retirement accounts and life insurance policies, are transferred upon your death to the person you have designated as the beneficiary. Regularly reviewing and updating these designations is essential to ensure they align with your current wishes.
- Organizing Documents and Account Information: Part of estate planning involves organizing important documents and account information and letting a trusted individual know where they are. This includes not only your will and insurance policies but also digital assets like social media accounts, online banking accounts, and email accounts.
- Property Ownership: If you own property, you should understand how it is titled because it affects how property gets transferred after your death.
- Estate Taxes: While Kentucky does not have an estate tax, it does have an inheritance tax which varies depending on how closely a beneficiary is related to you. In addition, understanding the federal estate tax and how it might impact your estate is important.
- Regular Review and Updates: Life changes such as marriage, divorce, the birth of a child, or significant changes in financial status should prompt a review of your estate plan.
Contact a Shelbyville Estate Planning Lawyer
Remember, estate planning is not just for older people or the wealthy; it is a smart choice for anyone wanting to make their wishes known and legally protected. It is advisable to consult with experienced estate planning attorneys familiar with Kentucky laws to ensure your estate plan meets your needs and complies with state laws. Berkley Oliver PLLC can compassionately prepare estate plans, tailored to your wishes and needs. Contact our office for a consultation to see how we can help you prepare in advance for any situation that could arise in the future.