5 Tips for Millennials’ Estate Plans
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Every adult can benefit from an estate plan, regardless of marital status, age, income, or assets. Our Chapel Hill estate planning attorneys have even reviewed estate planning tips for college students. Although decisions about what happens to your personal possessions and finances when you pass away might not be a priority for a young person, today’s generation of Millennials (individuals born from the 1980s to the early 2000s) have different tendencies and challenges than their predecessors.
One significant change: Delayed marriage. According to Decennial Census data, just 30% of 20 to 34 year-olds were married in 2013. In contrast, 77% were married at the same age in 1960. Certain spousal protections and tax advantages may not be enjoyed by this generation until later in life. Millennials now represent one-third of the population, the largest generation in the country, and they might need a different approach to their estate plans:
- Update plans regularly and as needed. Most Millennials entered the job market during a historically bad time: The Great Recession. Some individuals took whatever job they could find, regardless of location. Before or upon relocating to another state, meet with your estate planning attorney to ensure necessary updates are made. Laws in your new state of residence might not offer the same advantages as in your previous jurisdiction, and some documents might not be recognized in your new state of residence.
- Advance directives. In North Carolina, another person may not make financial or medical decisions on another person’s behalf without a health care directive or power of attorney. In the event you are incapacitated, who will make important decisions for you? Under what circumstances do you want life-sustaining treatments? Individuals may also use Five Wishes documents, which are recognized in most states.
- Asset protection. The average graduate carries $29,400 of student loan debt as of 2012. According to an October 2014 report from The White House’s Council of Economic Advisers, 61% of Millennials attended college (and 19% are forecast to attend graduate school). Considering unemployment and job uncertainty, individuals might want to discuss asset protection strategies to minimize or eliminate creditor threats.
- Beneficiary designations. Payable-on-death forms and designations for financial accounts, insurance policies, and retirement accounts will be followed regardless of instructions left in a will. Up-to-date beneficiary designation forms are critical to ensuring assets pass on to desired persons.
- Will. Millennials might be in the early stages of acquiring assets, but it is still important to have a will in place which allows the testator to bequeath their possessions and assets to specific individuals. Without a will, North Carolina intestacy laws apply, which might not match an individual’s wishes. If a testator has children, a will can provide guardianship instructions.
Regular reviews of your will and assets allow your estate plan to effectively preserve your wishes. Starting an estate plan early allows your plan to grow with you.
