Why Even Young Adults or Those with Few Assets Need Estate Planning
A lawyer friend of mine recently told me a sad story. A 21-year-old man was estranged from his
“dead-beat” dad and was living with his mother.
He was involved in a car accident and was awarded a sizeable settlement. Tragically, while waiting for the settlement
award, the young man died. Because he
had no will, the intestacy laws of the state intervened to distribute his
property—which included the settlement money.
This meant that half of the settlement would go to his mom and half to
his dad, whom he had not seen in years.
My friend was trying, with no success, to locate the father. “It’s a lose-lose situation,” my friend
explained. “If we find the dad- half of
this settlement ends up going to a man who never even cared for this boy. If we can’t find him,” she explained, “those assets
will escheat. (In other words, be turned
over the state). Either way, the mom
will never receive that share.”
I often hear folks say, “I’ve got nothing . . .I’m too broke
to need a will . . .Estate planning is for people with money.” Au contraire!
First of all, you might be surprised at how much you actually have. Even just a home, car, and a life insurance
policy can add up to a sizeable amount.
Also, you never know when you might receive an unanticipated source of
income. (We all wish for it. . . and
yes, it does happen). But perhaps the
most important part of having an estate plan isn’t even about having a will at
A will distributes your assets after you die. But what if, due to an illness or injury, you
are still alive but have become temporarily or permanently incapacitated. (in other words, unable to make decisions for
yourself). Having a will is only a small
part of an estate plan. Other estate planning documents are absolutely
essential during a time of incapacity.
A durable power of attorney, for example, appoints someone to act on
your behalf to do things like pay your bills and access your funds. A health care power of attorney appoints
someone to make health care choices for you when you cannot do that on your
own. A HIPPA release gives doctors
permission to release your health care information to those you want to help
you. An advance directive gives doctors
specific instructions regarding end-of-life treatment. And a digital diary keeps a record of your
digital accounts, like online photos. All
these documents come together to form a comprehensive estate plan.
Estate planning is not just for the wealthy. It is for everyone—even young adults and
those with few assets! Take the time to
plan ahead. Get your estate planning in