According to a new study by caring.com, only 42 percent of U.S. adults currently have estate planning documents such as a will or trust. For those with children under the age of 18, the figure is even lower, with just 36 percent having a plan in place.
Why is estate planning important even when you are younger and/or don’t have substantial assets to transfer at death? Because incapacity happens. It is comforting to know you have named a person you trust to handle your affairs while you are alive and need an agent’s decision-making assistance due to illness or accident. You can name a partner you haven’t married, or a best friend or cousin, or maybe a neutral fiduciary who you would prefer to make financial and healthcare decisions for you than a family member.
If you have minor children, the most important part of a will might be to nominate a guardian. Most people have certain relatives in mind that they DON’T want to be the guardian for their children — a will gives you an opportunity to nominate someone else so the probate court is aware of that preference. A trust gives even more options for the care of minor children without the need for court oversight (which may or may not be desired).
Those who have taken the time to create an estate plan would no doubt agree: Naming fiduciaries, including simply an agent in a financial power of attorney and advance health care directive, will help you sleep better at night.