You may think that estate planning is something best left until your 40s or 50s, when you have some kids and a few assets like a house and 401(k) worth protecting. Maybe you just started a new job or are planning your wedding, so estate planning is just not something on your priority list right now.
That's understandable, but if estate planning isn't on your to-do list, here are a few reasons why it should be.
1. It's not that complicated right now.
Right now, you may not have many assets, but the probate process is difficult and time-consuming even for small estates - especially if there isn't a will. Do you really want to make your partner, spouse or parents go through that process without some direction? It only takes a few documents to put your family in a good position to administer your estate should the unthinkable happen.
2. It gives your family direction.
Say you got into a life-changing car accident. The doctors have put you into a medically induced coma and your prognosis is uncertain. Would your mother or boyfriend know how long you'd like to stay in such a state? What if your doctors want to try a risky procedure but need the family's approval to do it? Who will make that call? Beyond the medical situations, who will pay your rent or take care of your pets in this scenario?
These are the questions that a power of attorney and living will address. Both of these documents give your family insight into your wishes and direction on what to do if you become incapacitated for any reason. A power of attorney may also help if you are headed overseas for a long trip, for work or for study. That way a trusted individual can take care of any financial emergencies in your absence.
3. It gives you a starting point.
Even a simple estate plan can help you plan better for your future. By taking stock of your current financial and personal situation, you can set goals for where you'd like to be in the next five, 10 or 15 years. You can (and should) always update your estate plan later as you hit new milestones like getting married, having children or growing your investments.
Most importantly, creating a simple estate plan gives you and your family peace of mind about the future. While you can't control tomorrow, you can make a concrete plan for what you'd want that tomorrow to look like if you're not there.