By Mary Beth Storjohann AdviceIQ.
Watching financial advisors put their house in order can teach you about building your own plan. You're never too young, and here's why.
My husband Brian and I married two years ago. I went through our finances, combined accounts, changed names, updated beneficiaries and made a list of items to complete: wills, powers of attorney and additional life insurance for me.
Our finances are fine. Our estate plan remains uncompleted. My insurance aspirations hit a paperwork snag. Time gets away from advisors too.
We both completed the forms required by the military to finish our wills; Brian, a Navy officer, completed his copy before he deployed earlier this year. Executing my copy required my presence during a hectic workweek. After gathering dust on our desk, my completed draft now sits outdated.
In addition, I swore to get additional life insurance, even applied for it, when an outstanding, uncompleted check-up from some three years ago bumped me from coverage. Another item back on the to-do list.
On a mission to get these items in place before the end of this year, I see lessons in this for me and for others.
As a young adult, your sole exposure to estate planning relates to your parents' wishes. You assume, especially if you're young, that only the rich or those with complex investments and troves of valuables need estate plans.
No: You need an estate plan once you hit 18, proper documentation to ensure you control your possessions' distribution at your death, to control your wishes for medical care and to oversee your children's care. Time to think about what you want as well.
Who stands to inherit your personal assets? Are certain items going to specific people? Your assets to your spouse, your grandmother's jewelry to your sister or your DVD collection to a local charity, for example?
Anyone in mind as executor of your will to oversee your wishes?
Who carries out your financial tasks if you become incapacitated? If you own a business, who takes care of that?
Have you made a durable power of attorney appointing a representative, a spouse, sibling or parent, to perform actions on your behalf such as pay bills and make your financial decisions?
In a medical emergency, who makes decisions on your behalf?
An advanced health care directive (or living will) documents what medical care, including life support, you want. A medical power of attorney designates the representative to carry out those wishes.
Who do you want to care for your children? Without an appointed legal guardian, stated in a will or trust, anybody from family friends to relatives to social services agencies may apply for guardianship through the courts.
Any recent changes in your life such as marriage, divorce, birth of a child or sickness? Review your estate plan annually and work with an estate planning attorney on all these documents and changes.
Your estate plan makes it easier for your survivors to move forward healing and rebuilding, and you're never too young or busy to think about that. ___ ABOUT THE WRITER Mary Beth Storjohann is the founder of Workable Wealth in San Diego