Like everything else in life, our estate planning needs change as we grow older. I define Estate planning as making plans and arrangements for the future, in case anything bad happens to me, like becoming disabled or dying. It’s about determining who I want to help me if I can no longer take care of business myself, and what I want them to do to assist me, either during my lifetime, or to wind up my affairs after I’m gone.
The tools of estate planning include both simple, non-legal steps like using joint accounts or beneficiary designations, or life insurance; and more legally oriented steps such as Powers of Attorney, Wills, and trusts.
Estate planning is not just for the wealthy. If you own anything, or if you have a family, spouse, children, an unmarried partner, or if you might possibly ever get sick or die someday, then estate planning is for you.
Estate planning involves making clear decisions about who will act on your behalf, what responsibilities they will carry out, and formalizing those instructions in a legally enforceable manner.
ESTATE PLANNING AT DIFFERENT AGES:
Young adults after age 18 need estate planning as they begin to accumulate financial interests or family ties. Not many college students have them, but a Power of Attorney given to parents on a standby basis, would be very helpful if a young person became disabled.
For young families, it becomes extremely important to make arrangements to provide for and protect spouse, children, and property interests, such as perhaps a new home. There will be an increased need for more formal tools such as Powers of Attorney and a Will, including provisions for Guardians and trustees for minor children. (Without a Will, state law decides who will inherit my property and it may not be what I would have wanted.) Preparing for educational costs for children also becomes a concern.
Any special needs child or other family member or dependent also deserves appropriate planning to help secure their future. In addition, a life partner who is not a married spouse may create particular planning needs because they lack the legal protections and decision making authority of a legal spouse.
In the middle phase of life, people often accumulate more wealth and new and different kinds of problems. Thinking ahead about the transfer of wealth to the next generation or others, and strategies to minimize tax costs, require thoughtful attention . Owning business interests creates both need and opportunity to shape future transition arrangements.
When people marry, especially in second or subsequent marriages, a prenuptial agreement may be the opposite of romantic, but extremely practical. Sometimes parents want to protect the future inheritance for their own children against the risk of divorce related claims against their adult child/ beneficiary by a son- or daughter-in-law. Also, securing future access to my digital assets and online activities by others on my behalf can prevent otherwise foreseeable headaches.
As we continue to age, our planning focus may shift toward retirement and medical decisions, including healthcare directives naming our own preferred surrogate decision-makers if needed, as well as the cost of long term care and asset protection planning.
All such planning is, by definition, an imperfect exercise. What’s the saying? Man plans and God laughs. There is ordinarily no perfect answer, or one-size-fits-all solution. We make the best choices we can, to make it most likely that our successors will accomplish our goals.
When should we review and revise our estate planning?
Whenever there’s any significant change in the people, property, places, or the public laws that apply. Additional examples include: If you move to a different state, if your property interests and wealth change significantly, or if there are changes in the laws that will affect handling or winding up your affairs. It’s never to late to start!
What is the cost of this kind planning? Is it worth it?
In the long term, planning saves money by limiting uncertainty, disputes and the need for future legal work. We can’t afford to fail to plan for our own future, our finances and our families. All that’s at stake is everything we’ve ever worked and saved for, and the people we love.
When you consult an attorney for estate planning help, always ask in advance what the fee or fee arrangement will be, what’s included, what’s extra, etc. When I choose a lawyer or a doctor, I want someone with a good head and a good heart.