Why Millennials Need Estate Planning
Despite the popular perception of millennials as financially irresponsible putty in the hands of the avocado toast lobby, most millennials are actually pretty good with their money. Millennials are actually ahead of earlier generations in terms of understanding the need to save. Believe it or not, more millennials are passionate about creating financial security (84%) than are passionate about raising good children (60%).
Even though millennials may demonstrate financial aptitude, Estate Planning is still–unsurprisingly–a blind spot for young people. Estate Planning, which also includes designating financial and medical agents under power of attorney, is not a process reserved for graying seniors with millions of dollars of asset. Rather, it is a crucial step in adulthood and risk management, and it is a step that every young person should take.
Powers of Attorney
In the event of an unforeseeable accident, it is important that millennials (and everyone for that matter) have established a way to communicate their wishes for end-of-life medical care and delegate someone to be responsible for making decisions. After the age of 18, generally, parents no longer have the legal ability to make medical decisions on behalf of their children. By creating a living will and designating a medical agent under power of attorney, young people can untie the hands of their loved ones and enable someone they trust to execute their wishes.
Student Loan Debt
One of the reasons that young people are so conscientious about money is that the burden of student debt weighs heavily on many of them. What they may not know, however, is that student debt is not always automatically forgiven at death. While a few private lenders have policies that forgive debt in the event of death, this is not the norm. For many private student loans, responsibility transfers to a spouse or a parent if the lender is unable to pay.
No one wants to burden their family with their expensive debt. By doing some simple Estate Planning, young people can take the necessary precautionary steps to ensure that they don’t unwittingly charge their family with paying for their debt.
Another misconception that keeps young people from doing Estate Planning is the idea that they simply don’t have enough assets to justify doing so. This is not correct. First, as described above, Estate Planning involves much more than just a will to dispose of assets. Just as it is never too early to designate a financial and medical power of attorney, it is never too early to plan the allocation of assets. Many people never think about the distribution of their wealth (regardless of size) until they buy a house, or settle down to get married, or have a child. But no matter where they are in their financial journey, it makes sense to plan for the day when they will pass on their assets. This is especially true for people who expect that they will inherit wealth in the foreseeable future.
Digital asset law is a new, developing, and largely uncharted area of law. Digital assets can include photos stored in iCloud, Facebook account, blogs, and cryptocurrency (Bitcoin, Ethereum, Litecoin, Etc.). When individuals try to allocate/plan for digital assets on their own, they don’t realize that they are running up against lengthy and detailed terms of service agreements. There is an entire legal regime in Colorado that actually controls the ability to access digital assets during incapacity and after death called the Revised Uniform Access to Digital Assets Act (RUFADAA).
A licensed estate planning attorney can help you come up with a comprehensive plan to address the distribution of your wealth, liabilities, digital assets, and more. In addition, an attorney can help you to designate agents under medical and financial powers of attorney. These are services that young people are in need of. Everyone deserves the peace, regardless of age of wealth, of knowing that their affairs will be taken care of when they cannot take care of them themselves.