Estate planning is an important aspect of financial planning that millennials may often overlook. The process involves making decisions about assets, healthcare, and financial affairs to help provide peace of mind for a person and his or her family. If you would like to learn more about estate planning for millennials, consider scheduling a consultation with an experienced San Francisco, California estate planning attorney from Von Rock Law today by calling (866) 720-0195.
Estate Planning and Millennials
Individuals born between 1980 and 2000 are commonly referred to as millennials. Even though some in this demographic take their estate planning obligations seriously, many still need a comprehensive estate plan. A Last Will and Testament (will) alone is only one part of an estate plan. Estate planning provides critical protection for a person’s loved ones. The plan gives direction for how to handle a person’s assets, real estate, and healthcare and the guardianship of minor children.
Developing an estate plan does not require substantial wealth or a large estate. Individuals with only modest assets, such as a small bank account, should still think about establishing an estate plan. An estate plan documents the disposition of assets in the event of a person’s demise, enabling loved ones to avoid making difficult decisions regarding children, pets, and investments.
At What Age Do Most People Do Estate Planning?
According to the United States Government Accountability Office, millennials have fewer assets than other generations, but that should not stop them from planning for their future. Any age is the right time to consider estate planning for millennials. The ideal age depends on family dynamics, financial considerations, and personal circumstances. Many financial planners will recommend that people begin estate planning when they have acquired assets or dependents that must be dealt with in the event of death. Many millennials do not consider estate planning, but it can help to ensure that bank accounts, pets, and children are managed after a person’s death.
Is Estate Planning for the Wealthy Only?
Estate planning is not just for the wealthy. While many people associate estate planning with high-net-worth individuals, all people who want to protect their assets and ensure that their wishes are fulfilled after they pass away can create estate plans. Estate planning can involve at least the following steps:
- Creating a will or trust
- Designating beneficiaries for retirement accounts and life insurance policies
- Establishing powers of attorney for healthcare and financial decisions
These tools can help anyone, no matter their wealth, to make sure that their assets are correctly distributed, their loved ones are safeguarded, and their financial affairs are properly managed if they become unable to do that for themselves. An attorney from Von Rock Law may be able to explain more about your estate planning options.
What Are Five Components to Consider When Estate Planning?
According to the American Bar Association, estate planning covers the transfer of property and assets to family members or other loved ones. Estate planning involves careful consideration and preparation to ensure that an individual’s assets are protected and distributed according to his or her wishes. While there are several factors to consider in the planning process, the following five components are fundamental to any comprehensive plan.
Will or Trust
A will or trust is a legal document that outlines a person’s instructions for how his or her assets should be distributed after death. A trust or will ensures that an individual’s wishes are carried out and that the person’s assets are distributed according to the named beneficiaries.
Power of Attorney
A power of attorney is another legally binding document that designates a specific person to act on behalf of another person if he or she becomes incapacitated or otherwise unable to make his or her own decisions. By declaring a power of attorney, a person’s financial and medical affairs will be managed in accordance with his or her wishes in the event of death or incapacitation.
Healthcare Directive
A healthcare directive is also known as a living will. This legal document is used to specify an individual’s medical treatment and end-of-life care preferences. Many people use this document to ensure that their family will follow their wishes for medical care if they cannot communicate their preferences.
Beneficiary Designations
Beneficiary designations indicate who should receive certain assets like life insurance policies, retirement accounts, and bank accounts after an individual’s death. This component is essential for ensuring that assets are distributed following an individual’s wishes and passed directly to the intended beneficiaries, in some cases without going through probate.
Guardianship Designations
These designations indicate who should care for minor children if their parents cannot. This part of estate planning is vital for parents of minor children to ensure that their children will be cared for according to their wishes if they are no longer able to provide care.
The components of estate planning are complex and require careful consideration of an individual’s unique circumstances and goals. However, incorporating these fundamental components into an estate plan can ensure that a person’s wishes will be carried out and assets will be protected and distributed accordingly.
Why Estate Planning Is Not Just for the Wealthy
Many people falsely believe that estate planning is just for the wealthy. If a person has assets that need protection or wants to distribute assets to specific people, then an estate plan should be a top priority. Estate planning is a process that can benefit individuals of all income levels, from those with modest assets to those with significant wealth. This type of planning is particularly important for those with dependents to provide for after their death, such as minor children or elderly parents. Also, estate planning helps individuals minimize taxes and ensure that their assets will be distributed efficiently and effectively, regardless of the size of their estate.
While it is true that the wealthy may have more complex estate planning needs due to the size and complexity of their assets, estate planning is not limited to the wealthy. Many estate planning tools — wills, trusts, and powers of attorney — are helpful for individuals at all income levels and can help ensure that their wishes will be carried out and their assets protected.
Contact a San Francisco Estate Planning Attorney Today
Estate planning for millennials can provide many benefits and protect a person’s loved ones. By planning your estate, you can make sure that your assets, children, and even pets will be managed after your death. If you are ready to get started, consider contacting an experienced estate planning attorney at Von Rock Law by calling (866) 720-0195 to schedule a consultation today.
