If you are a young adult in Massachusetts, estate planning might not be high on your priority list. However, overlooking this crucial aspect can have significant consequences for you and your loved ones. Estate planning goes beyond distributing assets. It ensures your wishes are respected and your loved ones are protected in the event of unexpected incapacity or death.
Do young adults really need to plan their estates?
Yes. Even for young adults, there are several reasons that make estate planning crucial. First, regardless of property value, assets like a car, laptop or even a pet may need distribution according to your preferences. Without a will or trust, state laws of intestacy determine distribution, potentially not aligning with your wishes.
Next, student loans, credit card debt or medical bills can become the responsibility of your estate or family members after your death. Proper estate planning prevents creditors from seizing assets or suing heirs for payment.
If people financially or emotionally depend on you, like a spouse, partner, children, parents, siblings or friends, estate planning ensures their well-being in case something happens to you. And, in case of unexpected incapacity or death, you might have preferences regarding medical treatment, organ donation, funeral arrangements or your legacy. Estate planning ensures these wishes are known and honored.
Wills
Estate planning involves creating legal documents that outline how you want your affairs handled. Some essential documents include a will. This allows you to name a personal representative (executor), designate beneficiaries for your property and appoint guardians for minor children.
Trusts
Trusts are another option. These are legal entities managing assets for your benefit or others, helping avoid probate, reduce taxes and provide control over inheritance distribution.
Health Care Proxy
Young people also need Health Care Proxies. These enable you to appoint an agent to make medical decisions if you are unable to do so. This should include a HIPAA Authorization that grants access to your medical records for specific individuals or entities.
Power of Attorney
Yet another estate planning document young people need is the Power of Attorney. These documents allow you to appoint an attorney-in-fact to handle financial and legal matters on your behalf.
Conclusion
Delaying estate planning can lead to financial hardship, legal disputes and emotional distress for those depending on you. Whether it is safeguarding your assets, settling debts, caring for dependents or ensuring your wishes are respected, creating an estate plan is a responsible step for young adults in Massachusetts.