There are a lot of misconceptions circulating about estate planning. Many think that it’s only something you do when you have significant assets and older, but that’s not true. It’s never too early to plan for the future. There are specific estate planning steps that you’ll want to take as you reach various milestones in your life:
When you become a legal adult
Your parents have a legal obligation to make both medical and financial decisions on your behalf up until you’re 18. Their ability to have a say over your life ceases the day you become a legal adult, however. There are a few estate planning documents that you’ll want to get lined up as you enter adulthood, including a health care proxy and a durable power of attorney. You’ll be able to select someone to make medical or financial decisions on your behalf if you’re unable to do so by drafting these documents.
When you enter into a committed relationship
If you have found your life partner or are engaged, then you might want to set up a trust or draft a will outlining how you’d like them to inherit your possessions if you were to pass away unexpectedly. You may want to start discussing signing a cohabitation or prenuptial agreement to delineate what each of you owns.
You may want to take time to revisit any health care proxy, durable power of attorney or insurance beneficiary designation forms once you enter into a committed relationship as well.
When you hit other critical stages of your life
You should identify a potential guardian and consider setting up a revocable trust leading up to your child’s birth to provide for their needs if something happened to you.
It’s critical that you revisit all beneficiary designations and execute a new durable power of attorney and health care proxy if you divorce so your ex isn’t making critical decisions on your behalf.
You don’t have to sort it all out on your own
Estate planning can initially seem overwhelming at first as you find yourself making serious decisions that may impact both your and your loved ones’ futures. An experienced estate planning attorney will want to know more about your financial and familial situation before letting you know what legal documents should be draftedto ensure that those you leave behind carry out your final wishes as planned.