Who Can Benefit From an Estate Plan?
Updated: May 13, 2019
There is a common misconception that only families, people with a significant amount of assets, business owners, or people of an advanced age require estate plans. However, many other groups can benefit from speaking with an estate planner. Forbes reported that more than half of American adults lack even a basic estate plan. Approximately 60% of U.S. adults do not have essential estate planning documents, like a will or advanced directive. When deliberating who the best candidate for an estate plan is, the majority of Americans should change their mindset and understand that everyone needs a plan. Groups who often do not have an estate plan, but could genuinely benefit from one include: College students, Individuals who are single, and Child-free couples.
Tens of thousands of college students call the Triad area home. Last year, the University of North Carolina at Greensboro enrolled a total 20,106 students and North Carolina Agricultural and Technical State University enrolled over 12,000 students. Wake Forest University enrolled almost 8,000 students. Considering existing enrollees, graduate schools, and residency programs—the students in this region contribute to a significant portion of the population. Although an estate plan is likely furthest from a college student’s mind, having powers of attorney in place can help provide peace of mind, ensuring that a parent or trusted person will be authorized to handle healthcare and financial matters expediently in the event of a debilitating accident or injury. Without proper documents, a parent or guardian might need to petition the court for authority over healthcare and financial decisions; this can be an expensive and lengthy process, and any delay in having a guardian appointed might be detrimental in a medical crisis. Another consideration that almost all college students must manage is student loan debt. A regularly updated estate plan can be crafted with asset protection in mind if a student is concerned about creditors post-college.
Unmarried persons may not have a concern about providing for a surviving spouse in the event of death or incapacitation, but may have a significant other, ailing parent, or relative they would like to leave their assets to. Having a will or revocable living trust in place can ensure that assets are left to the intended beneficiary. Moreover, an estate plan provides a legal framework for more than asset transfers. If an individual is diagnosed with a disabling condition or suffers an injury, who will make critical medical decisions or manage finances on their behalf? Estate planning documents such as advanced directives and powers of attorney appoint a trusted person to oversee these matters.
Couples who have not yet had or do not plan to have children don’t need to rely on estate planning documents to choose a guardian or start a child’s 529 College Savings Plan. However, these couples still should consider developing regular estate plan reviews to ensure that their partner or spouse is provided for should an unexpected illness or death occur. Couples can complete living wills and powers of attorney to advise their partner or spouse on wishes concerning life prolonging measures and to ensure that their partner or spouse has authority to make medical decisions and manage financial matters on their behalf. They should also regularly review beneficiary designations on retirement accounts, life insurance policies, and other assets to reflect the name of their partner. Outdated designation forms could legally entitle a former partner or ex-spouse to the respective assets. Also, in North Carolina, married couples who own real estate property have the option of holding title as Joint Tenants by the Entirety, which can help prevent creditor claims against one spouse from attaching to the property.
Estate plans are not merely a sum of the components of a will, trust, or powers of attorney. Rather, planning is a comprehensive approach that incorporates review of assets and asset titling, tax implications, and immediate and future needs. Share this information with those who have no plan in place. Ultimately, no one is exempt from the benefits of estate planning. Schedule an appointment today to see how Mike Casterlow can help with an estate plan that works for your stage in life.