Many people believe that estate planning only benefits old, rich people. However, this is a common misconception. Most people, regardless of age or net worth, can benefit from creating a personalized estate plan.
A young adult may want an unmarried significant other to inherit his or her property or may want to name an alternate decision-maker in case of a medical emergency. Parents may want to select a guardian for minor children or protect a child’s inheritance. Older adults may want to leave assets to a charity or keep the details of an estate out of public record. A personalized estate plan can help you reach a wide variety of goals.
What can happen without an estate plan?
Because you can probably benefit from an estate plan during all stages of your adult life, it is usually best to begin drafting your estate plan sooner rather than later. If something unexpected causes incapacitation or death, it will be too late to create an estate plan. Also, if you become legally incompetent, you will no longer be able to sign legal documents, like those in an estate plan.
Without certain estate planning documents, you may not be able to choose what happens if you become incapacitated or pass away. Some unintended consequences of not having an estate plan can include:
- Receiving unwanted medical treatment
- Leaving no assets to a significant other you are not married to
- Passing on assets to unworthy family members
- Letting a stranger decide who will care for your minor children
- Allowing family members to wonder what your wishes were
Estate planning is rarely urgent, but it is an important task to complete because when it is time to use your estate plan, it will already be too late to create one. Creating an estate plan as early as possible can help you embrace the choices available to you and provide peace of mind. However, it may be important to note that once you create your estate plan, you must update it periodically, so that it always reflects your current wishes and situation.