It’s not a pleasant thought to imagine one’s own death, but it also shouldn’t keep adults from estate planning. A study conducted by Caring.com and highlighted by the AARP found that fully 60 percent of Americans don’t have a trust or any other form of estate planning in place.
Many respondents found that it was “too soon” to plan. Others believe that estate planning is only for the wealthy and assume their families will inherit their assets when they pass away. Others simply don’t want to think about the prospect of their own death. The study asked more than 1,000 respondents whether they had estate-planning documents in case of their death
Whatever the reason for a lack of estate planning, it’s an egregious oversight, and could leave your heirs with a mess on their hands. The good news is that older Americans have gotten the message.
“While most U.S. adults aged 18 and over have not done the needful, 81 percent of those age 72 or older and 58 percent of boomers (ages 53-71) do, in fact, have estate-planning documents,” according to the AARP article.
Retirement planning experts recommend that even younger people should be thinking about setting up a trust.
What is a Trust?
A trust works in a very similar manner to a will. It’s essentially a contract that legally identifies your wishes for distributing your money, property, and other assets after your death. It differs from a will, however, in the way it holds the assets for your estate. When you set up a trust, you designate a trustee who will oversee the transfer of all your assets to your identified beneficiaries. One of the most important differences between a trust and a will is that, unlike a will, a trust is not subject to legal probate before assets can be distributed.
In addition, trusts aren’t for after death: many people who set up a trust designate themselves as trustees so they can manage their own affairs during their lives. They also name a successor trustee who can take over the estate when they are no longer capable, either through death or disability.
Why Should Younger People Engage in Estate Planning?
While it may seem like a worry for the future, it’s important for younger people to engage in estate planning, especially if they have children, to ensure that they’ll be cared for by people designated by the parents who can use their assets for the benefits of the children. Unfortunately, the same Caring.com study found that 78 percent of millennials (ages 26 to 41) and 64 percent of Generation Xers (ages 42 to 57) do not have a will. In the event of an untimely death, this lack of estate planning could leave children and families with difficult and expensive legal woes.
Seek Professional Advice
To further discuss the benefits of creating a trust and/or a will or to collaborate with your attorney, look for a financial services firm that will customize a plan for you, your assets, and your lifestyle to make sure you’re protecting your family and friends.
At Toomey Investment Management, Inc. (TIMI), our business model is designed to treat all of our clients equally and fairly. We realized long ago that the financial industry dedicated many resources to capturing money from prospective clients but much less on service and accountability for existing clients. At Wallingford, Connecticut-based TIMI, we listen carefully, keep in touch, and return your calls and communications quickly, so you can count on us. We will work effectively to optimize your financial situation and solve your problems. Call us at 203-949-1710 or visit our website for more information.