A recent survey found that 92% of adults under age 35 do not have a will. Many of my own friends and colleagues fit this description. The most common explanations I hear are (1) they feel that they do not have enough to justify a will or (2) they do not have the means to pay for a will.
As for the first rationale, the label “estate planning” conjures up images of vast wealth and property ownership. In reality, your “estate” comprises all of your personal and financial interests. Providing your family and heirs some direction with regard to your assets lifts a major burden off of their shoulders in the midst of their grieving.
For married couples with children, the primary function of a will should be to name a guardian for their children. Informally asking a family member or friend to look out for your children is insufficient. For single parents, there is ever more urgency to name a guardian. In the event of a simultaneous death, who will become the caregiver for the children?
In addition, for couples with children, would you like your children to receive their inheritance outright at age 18? Without any planning, your children will receive money due to them upon reaching the age of majority. As wonderful as your children may be, few are capable of handling money very well at such at an early age. With some basic will drafting, money and assets can be held in a custodial account until your children are at least age 25.
As for the cost of planning, many young adults overlook the cost of probate. Simply put, you will pay during life or after death. Under Nevada law, if your estate totals more than $20,000 you must file a petition in court to distribute those assets. Even college students with several electronics (laptop, iPad, cell phone), a meager checking account, and their own car can surpass this threshold.
The probate statutes are designed to pass your assets to your family. Most people would like to have a say in how their earthly possessions will pass on to loved ones. Would you rather choose how the assets pass or allow the state to determine their succession?
Also, any good estate planning attorney will prepare documents to assist with incapacity planning. As young adults we tend to be more active and also subject to potentially incapacitating injuries. You should state who you would like to make medical and financial decisions on your behalf. As a result of the well publicized Terri Schiavo case, many are aware of the family entanglements that can ensue without these documents. Medical and financial powers of attorney are vital components of your estate plan.
Most do not blink at paying for home, auto and health insurance. Similar to these “just in case” protections, a simple estate plan acts as a safeguard for you and your family. For help with your estate planning you should contact a qualified estate planning attorney.