With marriage on my mind (I was just happily married this month), I thought it would be rather fitting to write about marriage and estate planning. Estate planning isn’t just for the baby boomers and people with significant assets. It’s important for younger people, as well. All adults should have a basic Will, Durable Power of Attorney, and a Health Care Proxy. Millennials are struggling to make it in the worst economy since the Great Depression, but that doesn’t mean they shouldn’t be prudent and protect themselves and their families in the unlikely event of an accident or tragedy.
Here are a few tips:
• Health Care Proxy: In Massachusetts, this document appoints an agent to make health care decisions for you if you are unable to. It can outline your healthcare wishes and the powers of your agent. Terry Shiavo (of Florida) likely never dreamed of slipping into a coma, leaving her husband and her parents to fight over her future for years. Save your families this stress and sign a Health Care Proxy. By appointing someone now when you are healthy, you can avoid needing a court proceeding down the road.
• Durable Power of Attorney: An agent is appointed either immediately or upon your incapacity to make financial decisions for you and to deal with your assets. This is quite convenient if you are out of the country, in the hospital, or otherwise immobile, for instance. By appointing someone now when you are healthy, you can avoid a proceeding in Court to appoint a conservator, which can be a messy, public process for families, often leading to great expense and family strife. But, be sure to name someone as an agent who you trust implicitly.
• Will: Have a Will drafted so Massachusetts doesn’t decide to whom your property passes on your death. This is especially important for folks in an unmarried, committed relationship and those with young children. All individuals with minor children should have a Will naming who would act as guardian for their children if anything were to happen to them.
• Term Life Insurance: This is a relatively inexpensive option to ensure that anyone relying on your income is protected in the event of death. It can be used for mortgage payments and to pay for a child’s education or your care in the event of an unexpected death.
Lastly, remember that all the documents discussed above should be updated after marriage. In addition, review all beneficiary designations for life insurance and retirement accounts to make sure they reflect your wishes. Good luck and get started!