I read an article earlier on LearnVest about Estate Planning. It was only vaguely interesting to me, because I figured that I was too young to do any kind of estate planning- also, isn’t that for really wealthy people who’ve built some kind of empire? Right now, my student loans negate my empire, don’t they?
After all, don’t you need an estate to do estate planning?
Apparently, you don’t need much of anything to begin estate planning, you just need to be over 18. Randy Gardner and Leslie Daff of Estate Plan Inc- the husband and wife team of attorneys consulted in the Learnvest article, say that it’s never too early to start planning- once you turn 18, your parents can’t make legal decisions for you anymore. They also say that you don’t need to have an empire of wealth for your ‘estate’ to go through probate (an un-fun court process needed to settle your affairs if you die without an estate plan in place)- an ‘estate’ of more than $20,000 can end up going through probate.
So how to start planning? The article is already helpful, but here are some of the top easiest tips I took away:
- If you have money stashed somewhere (an IRA, 401k, etc) make sure your beneficiaries are up to date. In my research, I read about a recently married couple where the husband died and never updated his beneficiaries to include his wife. His parents got the money and for reasons beyond me didn’t give the wife anything at all.)
- Perhaps setting up a Durable Power of Attorney is a good idea- though it seems slightly complicated. This is basically someone who is appointed (your spouse, a family member, a friend) to make healthcare and/or financial decisions for you if you are incapacitated or otherwise can’t handle your affairs. This article explains it a bit– as well as how to set one up.
- If you have children, setting up estate plans becomes even more necessary. You don’t want to have no plans in place if something unexpectedly happens to you. Look into setting up a Living Revocable Trust and make sure you have a will in place.
This stuff isn’t at all fun to think about, and we’re still young. But it’s kind of like having car insurance or rental insurance- you should always have a plan in place, especially when you have something to lose. Then you’ll be free to continue happily building your empire in peace.