People of all ages should have a plan for their estate

May 30, 2013

People of all ages should have a plan for their estate

Article provided by Katherman, Heim & Perry
Visit us at http://www.khpyork.com

When people think about estate planning, they often assume it is a task they need not take on until they have reached an advanced age. This common assumption could not be further from the truth. In fact, it is wise for people to start estate planning when they turn 18 years old, and to continue to make adjustments to their plans as they reach certain milestones.

Of course, as an individual ages, the types of plans they ought to make will often increase in number and complexity. Consequently, it is generally a wise choice to seek the counsel of a skilled estate planning attorney.

Estate planning needs for young, unmarried adults

While most college students -- and even most parents of college students -- will not consider the importance of estate planning once they turn 18 years of age, this is actually the first time when estate planning becomes particularly important.

When a young adult goes off to school, his or her parents may no longer have the right to the student's medical records or the ability to take part in important medical decisions. As a result, it is wise for students to complete a HIPAA authorization. Under the Health Insurance Portability and Accountability Act, completing such a form will allow the designated individuals to review the person's medical records.

It is also a good idea for students to sign a power of attorney, giving someone else the ability to handle the student's financial concerns if the student is no longer able to do so.

In addition, unmarried adults who are in long-term relationships may wish to alter these documents to designate their partner as their representative. Individuals in such situations can also create a trust or will to specify their partner as the beneficiary if something were to happen to them. If action is not taken, then intestate succession laws -- such as those in Pennsylvania-- will dictate who inherits the estate.

Estate planning for married couples with and without children

Estate planning needs become more complex when someone gets married and then has children. As with individuals in long-term relationships who are unmarried, married couples will likely wish to modify their will, trusts, power of attorney and HIPAA authorization to designate their spouse as their beneficiary and representative. If such action is not taken, conflicts may arise in a worst-case scenario between the spouse and the in-laws.

Once a couple has children, they should also modify the will to indicate who will be responsible for their children in the event of their death. Parents can also establish revocable trusts in such cases to determine at what age and under what circumstances their children will inherit their assets.