401(k)

Estate Planning for Young Professionals

Estate Planning for Young Professionals

If you are a young professional, estate planning is probably not even on your radar.

And why on earth should you have to think about it?

You’re young.

You don’t have many assets.

You’re single (and your grandma keeps reminding you about it).

Your family knows what you want.

You have other things to worry about.

You’re going to live forever.

However, estate planning is just as important (if not more important) for single young professionals as for older, wealthier, married-ier individuals.

But how do you create an estate plan? Where should you start? It’s a big question. Lucky for you, we have already done the heavy lifting. Here are 4 quick estate planning tips for young professionals:

1. Get a Durable Power of Attorney

In short, a Durable Power of Attorney is an estate planning document that gives someone (your “Attorney-in-Fact”) the ability to act for you in certain financial and/or medical situations.

“Why is this useful?” you may be yell-asking at your computer screen. And that’s a great question.

How much can you save for retirement in 2019?

How much can you save for retirement in 2019?

You remember that part of How The Grinch Stole Christmas (the Jim Carrey version, of course, because it’s the best one) where — spoiler alert — the Grinch realizes the true meaning of Christmas and his heart grows three sizes?

That basically happened in real life a few months ago, except instead of the Grinch it’s the IRS and instead of “Christmas” it’s “retirement savings.” (The heart-growing thing doesn’t really enter into it. Also Christmas was over a month ago. This was a bad analogy.)

Starting in the 2019 tax year (for filing in 2020), you can contribute even more money toward retirement accounts such as an IRA or 401(k). It’s a Christmas miracle!

Changes to IRA and 401(k) Contribution Limits

Below is a brief summary of the new inflation-adjusted numbers for retirement account contributions; see IRS Notice 2018-83 for more technical guidance.

401(k)s. In 2019, the annual contribution limit for employees who participate in 401(k), 403(b), most 457 plans, and the federal Thrift Savings Plan, is $19,000. That is up from $18,500 in 2018.