After graduating from college, and even law school, the thought of drafting your estate plan probably did not make the top twenty on your “to-do” list, and why should it? The only thing most young professionals have when they first start out is debt. However, after you land your first job, preparing your estate plan needs to move quickly to the top of that elusive “to do” list.
Regardless of your age, you might not think you have very much – but you probably have enough to want to have a say in who gets what.Young people may not view estate planning as a necessity when just starting their careers, but the reality is they should plan how their assets will be distributed in case something were to happen to them.
Estate planning is more than just deciding how your assets will be distributed. That is a large part of it, but there are other documents every good estate plan should include. A recent article in the National Law Review, titled “Five Estate Planning Documents Every Young Professional Should Have,” lists the documents that it suggests for every recent college graduates. Some of the suggested documents do not apply for Utahns. The following is a list of document that I believe is more applicable:
- General Durable Power of Attorney – This is a simple document that lets you choose who will handle your finances in case you are in an accident or get ill and cannot do it yourself.
- Utah Advanced Health Care Directive – This is a statutory document that replaces the “living will”, and which allows you to appoint an agent to make health care decisions when you are not capable of make those decisions for yourself.
- Will – Your will does not have to be complicated. However, if you want your property or any piece of it to go to someone in particular, then you need a will to make that happen.
- Beneficiary Designation – On many of your financial accounts, such as the retirement account (401k, 403b retirement plan) and life insurance your first employer gives you, designating a beneficiary allows you to decide who gets the assets of the account after you pass away.
- Simple Revocable Living Trust. The size of your estate should not be the determinative factor in having a Revocable Living Trust. Not only does it avoid probate, it can provide a separate vehicle for the management of assets. Statistics tell us that many of us will suffer some period of incapacity during our lifetime. With a living trust, a trustee can simply be authorized to continue the management of your property in case of your disability. This can all be accomplished without court involvement and without the costs associated with a guardianship or conservatorship.
Estate planning is for everyone, recent graduates included.
Reference: National Law Review (July 7, 2014) “Five Estate Planning Documents Every Young Professional Should Have”