This author frequently hears this question because people think estate planning is only for older rich people. Generally, an individual is an adult at 18, at which time he or she can prepare estate planning documents. Unfortunately, most young adults will not prepare such documents because they believe it unnecessary, too expensive, or never think about it. Thus, parents should advise and help their children with such documents.
Young adults may have cash, life insurance or assets given to them by relatives. Further if they are working, they may be participating in a 401k plan, an individual retirement plan or some other retirement plan through their employer. Upon their death, those assets are distributed according to the beneficiary designation or a Last Will and Testament which directs where those assets are to be distributed. If no documents exist, then a Florida statute provides how those assets are distributed.
Further, many young people have small children and pets. Have you ever thought whom you would want to take care of your children and pets should something happen to you and, if married, your husband? What if you are divorced? Would you want your former spouse to be the guardian of BOTH the person AND monies of your child? These questions can be addressed in a pre-need guardian and in your Last Will and Testament.
Would you want your monies distributed to a guardianship for your minor child and have them receive those monies at age 18 or would you want them placed in a trust so they would not receive monies until later in their lives? What 18 year old is wise enough to handle even a small amount of money? Many employers provide life insurance. The proceeds of life insurance may be distributed to your children at age 18 if placed in a guardianship. Further, a guardianship of the money will require ongoing court supervision, with the attendant cost, until they reach age 18.
What if you become incapacitated? Young people think “that will never happen to me”. A simple example can illustrate the issue.
Suppose on a late evening during spring break, college students (age 21), Joe and Charlie, are walking on the beach. Unknown to either of them, life is about to change forever. Suddenly, Charlie collapses from what appears to be an alcohol overdose. Joe takes him to the emergency room. Charlie’s divorced parents are notified and go directly to the hospital. Upon their arrival, they argue about whether to take him back to their home in Ohio or keep him in the local hospital. While Charlie was being treated, he had to be placed on a ventilator. Charlie did not have any advanced directive and, as ex-spouses are prone to do, disagree on all health care decisions.
If Charlie’s parents continue to disagree, it is likely that a guardianship will be necessary and the expense and time to create a guardianship may be enormous. More importantly, Charlie will have no say in whom he wants handling such decisions.
For a real life situation, you only have to look at the Terri Schiavo case to see unfortunate circumstances CAN happen when you are young.
ADVICE: If you are young, review your assets and give serious consideration to having advanced directives and, at least, a Last Will and Testament. If you have minor children, then consider whom you would want to handle their money and their person. Consult with legal counsel. In the long run, an attorney consultation could be the best money spent before a disaster strikes in your home.
WORD OF THE WEEK: Guardian, under Florida law, is a person who has been appointed by the court to act on behalf of a ward’s person or property or both. A guardian can be “limited” or “plenary”. The limited guardian is appointed by the court to handle on specific power designated by a court order after the court determines the ward lacks the capacity to do some but not all of the tasks necessary to care for his or her person or property. A plenary guardian is appointed by the court to hand ALL delegable legal rights and powers of the ward.
GENEROSITY IS A KEY TO HAPPINESS …REACH OUT AND HELP SOMEONE TODAY! 😎