Only 25% of 18 to 34-year-old Americans have an estate plan in place, despite the increase of deaths among young people since the beginning of the pandemic. You need to prepare for the unexpected, even while you’re young.
An estate plan is a plan that delegates your belongings to your loved ones or organizations in the event of your death. Everyone has an estate. It includes everything you own, including your money, car, and objects.
It’s better to make an estate plan sooner than later. The best time to make one is now, as you never know what could happen to you tomorrow or a year from now.
When you turn 18 and graduate high school, you’re a legal adult. It’s important to have a plan in place, so you don’t have to stress about making an estate plan last minute when you’re older or sick.
Talk with an Inkwell professional today to discover the benefits of developing an estate plan at a young age.
Estate planning is important for people of all ages because it ensures that the people you love will receive your benefits after your death. Without an estate plan, nothing is stopping government agencies from taking your dog even though you wanted your family members to have it.
You might think, “I’m young and healthy, why do I need an estate plan now?”
Unfortunately, tragic accidents happen all the time that leave young people incapacitated or injured and unable to make their own decisions. It’s best to have a secure plan in place for these reasons:
If you just graduated high school, you’re most likely overwhelmed with financial decisions, student loans, and other new responsibilities. Those responsibilities only get bigger as you get older.
It’s best to be ahead of the game and take your finances into your own hands now, so you’re not overwhelmed in the future. Here are decisions you should make now so the future is less stressful:
Following this advice not only helps you while you’re in college, but it also helps you in the future. Opening a line of credit helps you after you graduate and want to make big purchases. Having a plan in place protects you and your estate if anything happens to you while you’re away at school.
Estate planning as a young adult seems scary if you don’t know your options. Here are some of the ways to plan for the unexpected at a young age:
A power of attorney grants a trusted individual to make financial and medical decisions on your behalf if you’re unable to make them yourself. Setting up power of attorney while you’re young ensures you’re taken care of if you’re incapacitated due to mental or physical illness—which happens at any age.
Consider giving a close friend or family member power of attorney so you know your finances are in the hands of someone you trust if something happens to you.
A will is an estate plan that assigns your belongings and finances to your loved ones in the event of your death. Wills must go through the probate process, a court-monitored process that determines if your will is valid or not, before giving your family the benefits you’ve left them.
Probate courts are expensive, so this might not be the option for you if you want to save your family money. On the other hand, a will allows you to divide your belongings the way you want, so just remember this type of plan comes with pros and cons.
Living trusts are estate plans that avoid the probate process. While they’re more expensive to set up, they keep your family from dealing with the court system which saves them money in the long run.
Estate planning for young adults is overwhelming but necessary since you never know what will happen in the future. Inkwell takes off the stress of the entire process by creating a plan that fits your personal needs.
We make estate planning simple, understandable, and less daunting for young people. We know you have a lot on your plate as a young adult, and we want to help.
Contact an Inkwell professional today to create an estate plan before it’s too late.
What would you do if you couldn’t handle your own financial and medical decisions? What if your health deteriorates, making you unable to manage these arrangements? Delegating a power of attorney to someone you trust makes sure your affairs are in order.
A power of attorney (PoA) allows you to put financial decisions in the hands of someone you trust. When deciding who to choose as your power of attorney, consider a family member or close friend that you believe can manage your financial and medical decisions the same way you would. Making a PoA part of your core legal plan guarantees that these affairs are taken care of for you if you can’t take care of them yourself.
In the PoA relationship, there’s a principal, the individual signing over their financial decisions, and the agent, the other person that the individual chooses. The agent assumes financial responsibility for the principal. It’s the agent’s job to protect the individual’s assets, oversee financial choices, and handle day-to-day finances.
A PoA is beneficial for everyone, no matter your age, current health status, or income. You can’t predict the future, so it’s better to be prepared for the unexpected, which is why a PoA is helpful. It takes unknown stress off your shoulders and provides a stable, safe plan in case anything happens to you that makes you incapable of managing your affairs.
There are several types of power of attorney used for different transactions:
A healthcare or medical PoA allows a trusted individual to make medical decisions for the principal if they don’t have the mental capacity to do so. The principal gives consent to the agent beforehand to act as their medical PoA.
A non-durable PoA is only in effect for a certain amount of time. It allows the agent to act on the principal’s behalf for a specific transaction and time, and once that transaction is complete, the PoA is no longer in effect.
A durable PoA allows the agent to act on behalf of the principal at any given time. There isn’t a set period for how long the PoA is active. Once the principal becomes unable to make decisions for themselves, the durable power of attorney goes into effect automatically and doesn’t end until the death of the principal.
A special or limited PoA is explicitly for a one-time banking or financial transaction if the agent is unavailable, sick, or has prior commitments. Limited PoA and non-durable PoA are similar in that they’re both for limited amounts of time, but limited PoA is only for financial affairs. Once the singular financial transaction is complete, the agent can’t act on behalf of the principal, and they no longer have any authority as the agent.
In 2019, only 18% of Americans over 55 had a durable power of attorney. Today, that number has risen to 33%. The pandemic has nearly doubled the number of adults over 55 with a PoA, but over 50% of this population still doesn’t have one.
Because of the ongoing pandemic, more people are delegating a power of attorney in case they become ill and can’t make their own decisions. Now, more than ever, it’s vital to have a PoA. In these unprecedented times, you never know when your health could decline.
Are you interested in a PoA relationship? Inkwell offers plans for all of your PoA needs. Our team of experts can set up a healthcare power of attorney to make health-related decisions for you. If you want an agent to handle personal affairs, medical decisions, and finances when you are unable to, a durable power of attorney is a great option. We provide plans for all ages because we believe everyone needs to be prepared for the unexpected. Contact us today to feel secure in your future finances and medical decisions.
How are your assets currently organized? Are they organized at all? If you’re unsure how to prepare them, a living trust may offer the organization you need. Let’s look at how a living trust compares to a will and how it protects your assets from the probate process.
You may be more familiar with the concept of wills than that of living trusts. While the two are similar, they do have a few key differences:
A living trust is a great way to protect your assets because you transfer them to the trust while you’re still alive. And you still maintain full control over those assets. Many living trusts are revocable living trusts, which means you can change them at any time during your lifetime. You may serve as your own trustee, the person who manages your estate, or you can have someone else do it.
You can choose yourself or your spouse to be your trustee. However, you could also choose a corporate trustee, which is a trust company or bank that oversees your living trust. If you choose this trustee option, you receive the support of financial advisors, trust officers, and other professionals who help you put your living trust into action effectively.
If you choose yourself as your trustee, but you want to maintain control over the trust if you’re incapacitated or pass away, it’s best to appoint a successor trustee. A successor trustee steps in to oversee your assets and enact your wishes if you die or become incapacitated. This successor trustee could be a single person, such as a spouse or child, or a corporate trustee.
If you don’t have a living trust, your assets become subject to probate once you pass away or become incapacitated. Probate is the public legal process where the court makes sure that your assets are properly handled and distributed. This process is expensive, and it often takes a considerable amount of time, up to two years in some cases.
A living trust avoids the probate process by letting you and your trustees keep control of your assets. Since you maintain control over them, the court never has to divide everything up publicly. You keep your privacy and save yourself many legal costs.
If you’re ready to set up your living trust, reach out to us today. We work with you throughout the entire process so your assets go to the right people and places.
Estate attorneys—also known as planning lawyers— help you develop an estate plan and identify individuals or organizations you want to receive your assets after you pass. Throughout this blog, we’re going to help you understand estate planning basics.
What Is the Importance of Estate Planning?Protects Your Beneficiaries
Without an established estate plan, the courts get to decide who receives ownership of your things. This process can take years, cost a lot of money, and create bad relationships between loved ones. Estate planning allows you to manage your assets and decide who gets what after you pass.
Prioritizes Your Children
Although you don’t want to think about passing and leaving your kids without a parent, it’s important to prepare for the worst. In the unfortunate event that both parents of the kids die, you’ll want to assign their guardians in your will. Without a will that names these guardians, the courts decide who gets to raise and care for your children.
Provides Heirs a Big Tax Bite
Estate planning protects your loved ones, which can mean protecting them from the Internal Revenue Service (IRS). Estate planning is essential for transferring assets to heirs without creating a tax burden for them. Any amount of estate planning allows heirs to reduce a significant amount—if not all—of their federal, state, and inheritance taxes. Without a plan, heirs may have to owe the IRS a lot of money.
Estate plans help you stop fights between loved ones before they have the chance to start. Estate planning enables you to choose who controls your finances and assets. This reduces the risk of going to probate court and ensures that your assets are handled how you would like them to.
Inkwell provides high-quality legal services to families and individuals as they plan for the future. Contact us today to start on your customized estate plan!
What Estate Planning Documents Are Needed?
A will is one of the main components of an estate plan. A will ensures that property is distributed according to your desires.
A revocable trust allows you to own your assets and distribute them as you see fit in the event of your death. Since it’s revocable, you can change your asset distribution at any time during your life to meet your needs and fulfill your wishes.
Durable Power of Attorney
When drafting your estate plan, it’s important to designate a durable power of attorney (POA). This individual acts and makes decisions on your behalf if you are unable to do so. Without assigning a POA, the court decides what happens to your assets. POAs are essential because leaving these decisions up to the court may go against your desires.
Assigning beneficiaries is essential because you cannot pass every possession onto heirs. Assets such as retirement plans, savings accounts, and life insurance may not be given outside of a will, so the beneficiary must be clearly stated in the estate plan. Without naming a beneficiary, the court decides who the assets go to, which may go against your wishes.
Letter of Intent
A letter of intent is a document that’s left for a beneficiary. This document highlights the purpose of leaving a particular asset to a beneficiary after your death. Some letters of intent provide funeral details and other requests.
Healthcare Power of Attorney
A healthcare power of attorney (HCPA) is an individual you designate to make critical medical decisions on your behalf if you are incapable of doing so. This individual is typically a spouse or a close family member. When choosing an HCPA, you should choose someone you trust and align your views with.
Most wills or trusts incorporate guardian designation; however, not all of them. Guardian designation in estate planning is often overlooked. If you have minor children, make sure you assign an individual or couple to support your kids. These designated guardians should share your views, be financially sound, and be genuinely willing to raise your children in the event of both parents’ passing.
Do You Need a Lawyer for Estate Planning?
Estate lawyers are highly trained legal experts that strive to help you manage your assets after you die or when you are not capable of making your own decisions. Estate attorneys help you develop wills and trusts and guide you through the probate process.
Although you’re not required to have an estate attorney, many benefits come with having an experienced estate planning provider. Estate attorneys help you:
Start Your Estate Planning With Inkwell
Inkwell isn’t like other estate law firms. Our process prioritizes the needs of our clients and meets them at each stage of life. From adulthood to marriage to having kids, Inkwell guides you and updates your plan every step of the way. Reach out to us today to start on your comprehensive estate plan!
Nothing in life is certain except for death, and even then, we don’t know when we will pass away. If you set up a legal will now, you can distribute your assets after your death in a smooth, effective way. Let’s look at Missouri’s requirements for a last will and testament. Once you know how to create a last will and testament, you can begin putting your affairs in order.
Estate administration ensures that your loved ones respect your wishes for your assets when you’re gone. Estate planning also prepares for situations where you’re alive but unable to make decisions for yourself. An estate planning attorney can guide you through the process of setting up your estate and administering it. Let’s look at how your estate planning attorney helps you put your estate together.