Estate planning may seem like something that parents or older adults worry about because they are statistically more likely to need them than young people are. Young professionals who have achieved success in their careers may not see the value of creating an estate plan or feel the need to put together a thorough estate plan yet.
After all, they do not have any dependent family members who might require support if anything happens to them. What those young professionals fail to understand is that an estate plan is as much about their protection as it is about assets, providing for others, etc. Pressingly, they might benefit from estate planning if they ever have a serious medical emergency.
Incapacity planning can be beneficial for young professionals
An unmarried professional’s resources are at risk in an emergency. They can’t manage their assets or obligations and could be vulnerable to major financial setbacks. One of the reasons young people create estate plans is to provide instructions in the event of an incapacitating medical emergency.
An advance directive can explain their medical preferences. Powers of attorney can give other people the necessary authority to make medical decisions on behalf of a vulnerable person. Financial powers of attorney can also be important for those with valuable resources.
Their assets could be at risk if they experience long-term incapacity. If there is a financial instrument attached to a high-value asset, the lender might initiate collection efforts that could include foreclosure or repossession. Someone incapable of communicating or rendered unconscious by a medical issue cannot pay their bills or explain to creditors why they need a little grace.
Professionals who have accumulated valuable resources can protect their assets with financial powers of attorney. In the event of their incapacitation, someone they trust can access specific financial accounts to help fulfill their financial obligations.
From paying rent or a mortgage to sending the minimum payment due to credit card lenders, there are many key financial tasks that an agent or attorney-in-fact can perform on behalf of an incapacitated individual. In the worst-case scenario where a young professional dies unexpectedly, an estate plan can help ensure that they leave a meaningful legacy.
The creation of an estate plan is an important step for virtually all adults, including young professionals. Even young professionals without families may enjoy enhanced peace of mind after they create an estate plan that reflects their current circumstances.
