This post is Part One in a four-part series discussing estate planning for Millennials. You can find links to the other posts in the series here.
I'm single with no kids. Do I need an estate plan?
This scenario describes a lot of Millennials, and the short answer to the question is yes. Having an estate plan is a good idea no matter your family situation. Remember that there are two sides of estate planning: What happens to your STUFF when you die and who takes care of your SELF when you become incapacitated. Both aspects of estate planning matter, whether you are married with a large family or single with no kids.
What will happen to my STUFF?
Every state has a framework (called "intestacy laws") essentially providing an estate plan "by default." In Oklahoma, for instance, if you are unmarried and have no kids, the law says that, unless you have an estate plan directing otherwise, your estate will go to your parents or, if they are deceased, to your siblings in equal shares. End of story.
That might sound great, but intestacy laws are rigid and do not take into account other desires you may have for your property. Are there any specific personal items you want to leave to friends or loved ones? Do you want to leave any of your estate to charity? Do you want to ensure a particular relative does not manage your estate after your death? Do you want to provide for a niece or nephew's education? What do you want to happen to your online accounts? Without an estate plan, you cannot guarantee that your wishes will be followed.
So what kind of estate plan should you have to control who gets your stuff? At the very least, we recommend having a Will designating who will receive your assets after your death and who will be appointed personal representative to manage your estate. But remember that a Will may still need to go through probate before your beneficiaries can receive that you left them. Or you can save your family the time and expense of probate and create a Living Trust that gives you a much greater degree of flexibility and privacy.
(See our explanation about the main differences between a Will and a Trust here.)
There are other ways to leave your estate to friends or loved ones, but wills and trusts are generally the most common. The important thing is that you have a legally enforceabledocument stating who will receive your assets.
What will happen to my SELF?
Aside from you STUFF, you should also have a plan for who can take care of your SELF. Who do you want making your medical decisions if you can't? Who do you want to be able to manage your assets? What are your desires regarding end-of-life care such as life support?
Maybe you want your parents to be in charge if you become incapacitated. That's great. But without a document giving your parents the legal authority to make those decisions, medical providers and financial institutions may not allow them to access information about your medical care or financial accounts.
That is why we recommend you have a Durable Power of Attorney. Generally speaking, a power of attorney gives someone (your "attorney-in-fact") the ability to act for you in financial and/or medical situations.
What else should I do?
Regardless of the type of estate plan you have, we recommend you write a letter of instruction to your representatives or family, telling them everything they need to know to manage your estate. What subscriptions or services need to be canceled? What bills need to be paid? Where do you keep the key to your safe deposit box? Where do you keep your assets? What family or friends should they notify of your death? Giving these instructions can make it much easier for your representatives to properly manage your estate after your death.
In addition to writing a letter, you should have a family meeting or "fire drill" to let your loved ones know the basic contents of your estate plan and your other wishes regarding your estate and your medical care. How is anyone supposed to know about your estate plan unless you tell them about it? And even if they know about your estate plan, how is anyone supposed to find your documents unless you tell them where they are?
Lastly — and this is especially important for Millennials — we highly recommend you create a digital estate plan detailing how you want your online accounts disposed of and the information your representatives will need to access those accounts. Depending on the laws in your state, you may need to appoint a separate "digital executor" in your estate plan for this purpose.
Discuss Your Estate Plan With an Attorney
Every person’s situation is unique, and your estate plan should be crafted to address your goals, family circumstances, and assets. To discuss what estate plan may work best for you, call the Oklahoma City estate planning attorneys at Postic & Bates for a free, no-obligation consultation appointment.
Additionally, download our FREE Estate Planning Guide, packed with 70 pages of information about estate planning, probate, and much, much more, by clicking the button below.
[As with all our posts, the contents of this article do not constitute legal advice and are subject to our site-wide disclaimer.]