When you hear the term “estate planning,” you might envision an older couple arguing over how to divide their copious assets, properties and business holdings among numerous relatives – not someone closer to your age waylaid by student debt and uncertain job prospects.
All that said, now is the time to start thinking about the “long game.” People in their 20s and 30s often imagine that they have lots of time to prepare for the future. But time goes fast, and younger individuals are also susceptible to financial, medical and physical problems. The earlier you establish your estate planning strategy, the easier it will be to pursue your dreams, passions and relationships without inhibition or fear. To that end, here are 4 practical estate planning tips for millennials:
- Choose your beneficiaries wisely, and keep your list updated!
If you work for a company, that firm may offer perks like life insurance or retirement benefits. Who will receive those benefits? You might designate a sibling or close relative, but your life circumstances are almost guaranteed to change substantially over the next several decades, and your list of beneficiaries will also evolve. Update all accounts periodically and especially when you marry, divorce or have a child, or if a beneficiary precedes you in death.
- Address your life insurance needs.
When you’re young and healthy, life insurance carriers will be more than happy to offer you excellent rates that you can lock in for a long time. Some employers offer life insurance plans, but these tend to provide minimal coverage that typically won’t support a family or children in the event of your death. Additional coverage, such as term insurance, might be useful. Update all policies when you get married or when you have a child.
- Establish power of attorney, an advanced health care directive, a HIPAA release form and other critical care documents.
While no one wants to think about being incapacitated, you need documents like these in case of an emergency, so that loved ones can make decisions on your behalf and get a snapshot of your medical situation. Decide who should make medical decisions for you and who should oversee your finances if you cannot.
- Draw up a will or living trust.
Even if you are not a millionaire, you need to protect your financial future. If you do not have a will or living trust, state intestacy laws take effect, which means that your assets will be divided out according to predetermined state guidelines. The courts will not consider your wishes.
Call the ILP team today at (800) 827-7784 to discover planning tools and strategies to give you peace of mind, so you can pursue your career ambitions without fear and build the family you want.