You’ve said it a thousand times: Young adults need estate plans too. It’s an entreaty all too often met with a shrug of the shoulders and a wave of the hand. At that age, we think we’re immortal. But the uncomfortable truth is no one knows how much time is left.
I was reminded earlier this month how true this is. I thought back to a year ago when 58 people were killed during the Route 91 Harvest Music Festival shooting. A good number of those who lost their lives that day were in their 20s and 30s. And as I reflected on the pain their families must have felt and still feel, I caught myself wondering if any of them had plans in place.
I’d be willing to bet most didn’t, and it’s a shame, because their wishes died with them. How many families didn’t know if they wanted to be buried or cremated? How many couldn’t access their social media accounts to close them down or post in memoriums to honor their lives? These are things no family should have to wonder about during a time of such grief.
With this in mind, we must work together to encourage young adults to think about creating an estate plan. Let them know that just a few simple steps could save their families a lot of anguish if the worst happens.
Here are five steps you can walk them through:
- Draw up a will to create a plan for your belongings — who will inherit what, both financial and personal. Don’t forget about your virtual assets, like your iTunes and social media accounts.
- Make a list of your usernames and passwords to all financial and personal accounts, and make sure your loved ones know about it and have access if it’s online.
- If you’re working, you probably have a 401(k) and company-sponsored life insurance. Make sure to name beneficiaries on these accounts to avoid probate.
- Let your bank know you’d like a payable-on-death (POD) account. This allows you to name a beneficiary, which keeps the account out of probate.
- Name a durable power of attorney and health care proxy. These are two important estate planning documents that allow others to make financial and medical decisions for you if you become incapacitated. If you want to give your proxy specific instructions, create an advance directive, also known as a living will.
Through this conversation, you’ll help them understand that estate planning isn’t only for the old and rich — and that it’s just as much about their own peace of mind as it is creating clarity for their families in a time of chaos.
We can’t prevent tragedy, but we can help create a plan so families can focus on what matters: honoring the lives of their loved ones.
Please encourage your clients to work with you as well as their entire financial team when creating their estate plan.
— Read 3 Lessons Prince Left Agents and Advisors, on ThinkAdvisor.
Michael Babikian is the chief executive officer of LegacyShield, a financial services exchange built around a family information management system.