Who needs an Estate Plan?
Who needs an estate plan? Everyone over the age of 18.
Older Individuals: This is more obvious and more individuals over the age of 55 will actually engage in estate planning. They feel that they now have the assets accumulated that need direction after their death. Also, as they are older, they believe that the chances of death are greater.
They are right on both counts. It is important as we age to look at what we have accumulated in the areas of real estate, cash assets and personal property. Then it is important to plan for the ultimate distribution of these assets upon our death. For couples, it is important to plan for the comfortable continuation of life for the survivor.
Individuals with minor children: This group often does not engage in estate planning because they may have more debt than assets. Since they feel they do not have an “estate” they believe that there is no need to plan.
The only place to designate a guardian for their children if they should pass is a Last Will and Testament. This is more important that who gets grandma’s hutch.
When an individual has a child, one of the first considerations should be for that child’s future. Part of the unknown future is what happens if the parents die. While it is less likely that both parents will die prior to the child(ren) attaining the age of 18, it happens. Accidents happen – suddenly.
Who would care for your children? You must name these individuals.
How would they care for your children? If you do not have sufficient assets to raise your children, you should consider the purchase of sufficient life insurance to provide for care of your children until they are 18 or 21.
Individuals over 18: This is a group that understandably do not even think about the estate planning process. However, there are two vitally important documents that each of them need – Durable Power of Attorney and Durable Power for Health Care or Patient Advocate Designation.
The minute a child turns 18, he or she is considered to be an adult. While still living at home, on his/her parents’ medical insurance, if he/she were injured in an accident or became acutely ill, the parents would be unable to direct any of their child’s medical care. They would not be permitted to discuss their child’s medical condition with the medical staff at the hospital and would not be permitted to have any access to the medical records or information.
It is for this reason that every child turning 18 should execute these documents naming his/her parents as the agents and advocates. This is not taking adult power away from the child, but providing for his/her care and safety.
So the answer to the question, “Who needs an estate plan?” is everyone. It will take a different form with different documents, be all need a plan.