Navigating estate planning might seem like a distant concern for younger generations. However, taking proactive steps early on can have significant benefits. Estate planning is not just for older adults.
Instead, younger generations stand to gain from thoughtful preparations.
1. Establish a will
An important aspect of estate planning is the establishment of a will. Regardless of age or financial standing, having a document outlining where assets should go in the event of unforeseen circumstances is key. A will ensures that personal belongings, financial assets and other possessions end up in the right place, providing peace of mind and avoiding potential complications.
2. Designate beneficiaries and keep them current
Designating beneficiaries on financial accounts, insurance policies and retirement plans is necessary during estate planning. Younger people may overlook the importance of keeping these designations current. Life circumstances change, whether through marriage, the birth of children or other significant events.
3. Make health care plans
While it may seem premature, establishing powers of attorney and drafting health care directives is important for younger generations. These documents grant trusted individuals the authority to make financial and health care decisions on someone else’s behalf. Taking these steps early provides protection, ensuring that someone the individual trusts can make decisions aligned with their preferences.
According to Kiplinger, 78% of millennials consider building multigenerational wealth important. In contrast, just 45% of members of older generations say the same. Taking these steps is about planning for the future, and it is also about embracing a responsible, forward-thinking approach to financial well-being.