According to an article on CNBC, 68% of young people expect to get an inheritance from their parents. That sounds wonderful. However, it seems like there’s a lack of communication with their parents since only 40% of their parents will actually leave an inheritance. Natixis U.S. Investor Survey’s research indicates that 44% of boomers don’t have a will, 57% don’t expect to have money left to pass on, and 35% plan to spend all their money on themselves.
What can be done to fix this this misperception by millennials (a person reaching young adulthood in the early 21st century)? The first step is that parents need to openly talk to their adult kids about their estate plans, including any inheritance the children might or might not receive.
If you’re a millennial, the next step is that you need to take this as a wake-up call and start planning for your own future. That includes doing an estate plan that contains the following:
Will: A will is a legal document that directs who will receive your property upon your death, and it appoints a legal representative (“executor”) to carry out your wishes. Millennials might think they don’t have enough assets to do a will or a trust, but they’re often surprised when they really start to think about it. For example, in addition to money, they could have equity in a condominium or valuables they would want to leave to someone. If you have a pet, you might want to specify care for your pet. And then there’s your digital assets. Who will handle your social media accounts and other online accounts like online bill payment or investments. You should provide that person with a list of your accounts and passwords.
Durable Power of Attorney: This allows a person you trust to control your finances in the event that you become unable to do so yourself.
Health Care Proxy: Choose someone you trust to make medical decisions for you in case you become incapacitated.
Living Will: A living will works in conjunction with a health care proxy by expressing your wishes as to how your designated agent should proceed in specific circumstances such as how and when you wish to receive medical treatment in the event of a terminal illness.
The good news is that getting started is really the hardest part of estate planning. The actual process is fairly quick and inexpensive and will provide you with enormous peace of mind. Contact us at 617.299.6976 or mkarr@maheritagelawcenter.com.
