Broker Check
(734) 356-3250 
The Importance of Basic Estate Planning Documents for Young Adult Age Children

The Importance of Basic Estate Planning Documents for Young Adult Age Children

| September 06, 2023

I can't believe school is back in session already. My son Owen is off to Central Michigan University this fall, and I am very excited for him. Part of his preparation process was mapping out a plan that included a list of the things he needed to pack and complete before his move. One of the checklist items that we made sure he had on his list was to complete essential estate planning documents before he left for school. When we discussed the importance of having these documents completed now that he is an adult, he wanted to know what was included in a basic estate plan and why it was important to have one. 

A basic estate plan typically includes the following: 

Will:  A will is a legal document that outlines an individual's wishes regarding the distribution of their assets and the appointment of an executor to manage the administration of their estate after their death. While most young adults have yet to accumulate significant assets, it is a responsible and prudent step to plan for the future. 

Power of Attorney for Medical: This document grants another person the authority to make medical decisions for the individual if they cannot do so due to illness, injury, or incapacity.

Power of Attorney for Financial: This document authorizes another person to handle financial and legal matters on their behalf if they cannot do so. 

Seven important reasons for having these documents in place: 

Health care decisions: Ancillary documents like a Healthcare Power of Attorney (or Health Care Proxy) and a Living Will allow someone they appoint to make medical decisions on their behalf if they become incapacitated and cannot make those decisions themselves. This can include decisions about treatment options, end-of-life care, and organ donation.

Financial management: The Durable Power of Attorney for Financial gives the authority to whom they designate to manage their financials in case they cannot do so, such as accessing bank accounts and paying bills. 

Minimizing family conflicts: Clear instructions reduce ambiguity. When a properly executed estate plan is complete, outlining one's wishes can reduce disputes among family members. The Terri Schiavo case exemplifies what can happen if an estate plan is not in place.

Digital assets and passwords: Ancillary documents can include provisions for managing digital assets, such as online accounts and passwords. This can be important for accessing and preserving digital information, financial accounts, and social media profiles. My son makes music and has released several albums, so it is essential to safeguard this information.

Funeral burial and wishes: Ancillary documents include instructions for funeral and burial, which helps family members carry out their wishes. 

Privacy and confidentiality: Ancillary documents allow your adult child to specify who has access to their personal information, like medical records and financial documents, protecting their privacy and preventing unauthorized access. 

Peace of mind: Implementing a basic estate plan allows for peace of mind, knowing that your adult child's wishes will be followed.

Let's face it: adding a basic estate plan to the college planning checklist was not Owen's most exciting checklist item. Most of us don't like to talk about scenarios of premature death or incapacity, especially during an exciting time such as going away to school. We refer to these as critical conversations that need to take place so proper planning can be done. Once Owen understood the reasons for getting an estate plan in place, he was ready to move forward and check this off the list!

We recommend that you consult with an attorney experienced in estate planning to draft documents that align with your young adult's specific needs and provide the necessary legal protections. In addition, we recommend that estate plans be reviewed every five years to adjust for life and possible tax law changes.