There’s a misconception that estate plans are only for individuals with a lot of assets or older individuals. However, the truth is, that estate planning is a smart and responsible step to take for all adults.
Each estate plan is unique and based on your needs and situation. Even though this is the case, there are some elements of an estate plan that everyone should include.
Updated beneficiaries
When you first start your estate plan, it’s important to ensure you have beneficiaries named for your life insurance and 401(k). If you aren’t married, you can name your parents or another relative. If you are married, most people will name their spouse. You can also name children as beneficiaries.
If anything changes in your life, for example, you get married or divorced, be sure to update your beneficiaries to reflect these changes.
Health care proxy
The person you name as your health care proxy has the right to make decisions about your medical treatment if you can’t do this on your own. You may also hear this called a medical power of attorney.
It’s a good idea to create this legal document as soon as you turn 18. A person can become incapacitated at any time and having someone named as their health care proxy can ensure that the proper care is provided to the individual in question.
Creating your estate plan
When it comes to your estate plan, it’s important to note that this is an ongoing process. Once you create the plan, you should review and update it regularly. This is going to help ensure that if something happens, you are covered and that the proper documents are in place.