Even Before You Have a Family or a Big 401(k) –
Estate Planning in your 20s and 30s
The protections from an estate plan are important even before you build up your savings or start a family. The bills you pay each month need to be paid even if you are too sick to handle your finances. The only way you can avoid problems with creditors is to appoint an agent with a durable power of attorney for finances or seek court appointment of a Conservator. A conservatorship is expensive and places your finances in the public view. By simply having a financial power of attorney and naming an agent an alternate agent, the people you want can handle your finances if you cannot and the court does not have to be involved.
Being married does not give you special protection. Without a power of attorney, your spouse can NOT access your retirement account for you, pay your separate bills, access your separate accounts, terminate your cell phone service, or perform myriad other activities. Your spouse cannot sell your joint home if you are too sick to sign the papers and you do not have a financial power of attorney. In this market, a good sale could be lost due to inopportune health.
A health care power of attorney is also needed. You can choose and authorize the right person to take care of your health care needs and talk to your doctors. Otherwise, there is a large group of people who will have limited power to assist you. Without powers of attorney, family members, friends, and roommates can all weigh in on some health care decisions.
Take a look at the following articles which can be helpful about the protections you can utilize to keep your finances and health care intact if you get sick. You can also make sure your assets go to the right people if you die:
Durable Power of Attorney: Power to Protect Assets
Where There’s a Will There’s a Way: Core Estate Planning Documents
A Good Deed for Avoiding Probate