Most young adults in their 20s and 30s are not thinking about estate planning. But making important decisions well in advance can provide peace of mind and help cut down on unnecessary costs. To help you make the best decisions possible, here are the top estate planning tips you need in your 20s and 30s.
Make Financial Plans for Your Final Days
The financial aspect of estate planning is one part of the equation. High funeral bills could make or break a family’s financial security, so taking steps to mitigate those stressors is important.
Consider Burial Insurance to Lessen Costs
You have health insurance. You have homeowners insurance. But what about burial insurance? This type of final expense policy can help cover your funeral arrangements and additional debt. If you leave medical bills or personal loans behind, the right burial funeral insurance policy could relieve that burden from your family’s shoulders.
Think About a Life Insurance Policy
While burial insurance can help with final costs, life insurance can help your family survive without your income if anything happens to you. Many experts suggest insuring both spouses, even if one is a stay-at-home parent, because of the significant value the at-home parent provides.
Regardless, a comprehensive insurance policy can provide peace of mind and financial support should you pass away unexpectedly. If you are single without kids, you can establish a beneficiary for your insurance policy. Or, you can modify it if you get married and start a family later. Insuring early in life also helps you avoid high premiums due to older age or health conditions that arise.
Save Money for Other Expenses
Maintaining a savings account is a helpful financial strategy throughout your life. If you start in your early 20s, setting aside a few extra dollars here and there can add up. Experts also say that by age 30, you should have at least $100,000 saved in your 401(k).
And while insurance policies and specialized college savings accounts are excellent options for specific needs, a savings account or 401(k) cover even more. With those funds, remaining family members can pay any debt, make additions to the funeral services you pre-planned, and help care for anyone you leave behind.
Ensure Your Family and Loved Ones Are Protected
While finances are an essential consideration, stipulations for your family’s well-being are, too. Once you are secure in your finances and know that you won’t leave unexpected expenses beyond, it’s time to think about the legal aspects that can ensure your family’s protection.
Write a Will (with Your Spouse)
Writing a will is often the first step in the estate planning process. It doesn’t cover everything, but it’s a smart foray into planning for your future. A testamentary will is your best option, as this is the type that requires a witness and formal signature.
Online wills may help you outline your wishes, but to ensure it’s airtight, consider getting assistance from a legal professional.
Establish a Guardian for Any Children
Leaving behind children adds another layer of complications to your estate planning. If you’re married with children, you and your spouse may want to decide together on a guardian for your children. If you’re single with a child, it’s even more important to outline a plan for their care if you’re unable to provide for them.
Discuss Your Final Wishes with Family
Having a conversation about your eventual demise can be tough, especially if you’re young and otherwise healthy. Still, it’s worth broaching the topic well in advance of any health problems. This way, your family will know what you want should the time come.
Be open about your thoughts and feelings—especially pertaining to the type of service and burial you want. Decide how you want your life celebrated if anything happens to you. Inform your family and then take the financial and legal steps to ensure your wishes are honored.
Photo via Pexels. This article is provided by Christopher Haymon.