The quick answer is no—adults of every age should have an estate plan of some kind. The specific documents you need and how you structure your plan will change as you get older and go through various life changes, but the earlier you get a baseline estate plan set up, the better prepared you will be for life’s uncertainties. We share our recommendations for estate planning tools you should consider at each stage of your life as a young adult.
You Are an Adult as Soon as You Turn 18
You might still be a student and living with your parents as your primary residence, but to the world, you are an adult at age 18. This means that your parents will no longer be able to do some of the things they did for you before you turned 18. The most important documents to consider when you turn 18 are powers of attorney and HIPAA releases:
Power of attorney
As a legal adult, you are responsible for making your own financial and health care decisions, something that your parents might have done for you before. With a power of attorney document, you give another person the authority to make health care decisions and take care of your finances if you are unable to. Many young adults name their parents, but if that is not an option for you, it is even more important to designate a sibling or friend as your power of attorney in case you are incapacitated in a car accident or traumatic fall.
Your parents will no longer be able to help with your medical care once you turn 18. This includes changing appointments, requesting drug refills, and receiving test results. If you need their help with medical tasks, be sure to contact your medical providers and fill out their paperwork to allow your parents—or anyone else you choose—to have access to your medical information.
These are both essential documents to have as soon as you are 18, and they are fairly easy to execute. An important piece of the process is letting your family and designated agents know what you have decided and giving key people copies of the documents.
What to Add as You Enter True Adulthood
Once you are officially on your own as an employed and independent adult, you should begin to incorporate additional documents into your plan. These documents can be revised as your financial situation changes, you enter into a committed relationship, and you have children. At a minimum, you should have the following:
Revised health care documents
As you move through your 20s, you might want to remove your parents as your legal representatives and add a significant other, close friend, or sibling.
You might not think you have enough assets to justify a will, but it is a vital document even if you don’t have a lot of money. With a will, you can express your wishes for your personal property, vehicles, pets, digital assets, and intimate possessions, such as journals or diaries. If you eventually buy a house, build up retirement accounts, and accrue savings, these assets can be easily added to your will.
If you have student loans or other ongoing expenses, you might want to invest in a life insurance policy so that these debts won’t fall to a family member if you were to die suddenly.
When you start a job and have benefits such as life insurance and retirement accounts, you need to make sure that you have named beneficiaries for these funds. As new important people enter your life, you can revise these designations accordingly.
Life Events That Warrant a More Extensive Plan
However old you are when you have children, buy a house, or inherit or earn a significant income, you should consider adding guardianship designations and a revocable living trust to your estate plan. For many people, these things happen in their 30s, but if you are ahead of the curve, you may need to meet with an estate planning lawyer in your 20s to plan for the following:
As soon as you become a parent, you should choose guardians and name them in your will. Your selection can be revised as often as you wish until your children turn 18.
Revocable living trust
This estate planning tool is a must if you have significant assets or you want more control over who inherits what and when. Assets held in trust do not have to go through the probate process in Texas, saving time and money for your heirs. Contact an estate planning lawyer to learn more about the benefits of a living trust.
Each individual has unique estate planning needs. The earlier in life you make talking to an estate planning lawyer a part of your version of “adulting,” the better off you—and your loved ones—will be.
Do You Need To Speak With An Experienced Estate Planning Lawyer In The Dallas Area?
If you need to speak to an experienced estate planning attorney please contact us online or call our Dallas office directly at 214.559.7202. We help clients throughout the Dallas area with all of their estate planning needs and look forward to helping you.