Video: Estate Planning for Young Adults (Part II)

Video

Hi folks, it’s Andy Stautz at Stautz Law. Today I’m back with Part 2 of our discussion on estate planning for young adults.  

So in Part 1 I talked about kind of the trade-offs, the balance between, you know, the complexity of your family and property situation versus the cost and time of doing formal estate planning.  

Today we’re talking about specific situations, some like real basic plans.  

So if you’re a young adult, let’s say you’re 30, you’re not married, you have no kids. Your plan could be really simple. It can be, you know, beneficiary designations on your retirement account; transfer on death deed for your House; and then a will to just take care of whatever is left. That way the bulk of your property is going outside of probate. You can probably use the small estate affidavit for the rest. Great.  

As soon as you get married the situation changes. Your spouse becomes, you know, number one person by default on your healthcare representative. Your intestate heir. So. For a married couple, the same scheme can work for property. Healthcare decisions probably made mutually. Uh, but it’s just something to keep an eye on. You know, when you get married, that’s a big change because your spouse instantly steps in to, like, all the roles.  

(So… I’ll probably do a follow up video on when to change your estate plan or like when to revise. Start thinking about it and marriage is a big one. So is divorce. So is having children.) 

The same scheme can work for a married couple, you know, just beneficiary designations take care of a lot if your property is mostly retirement accounts and house.  

Uh. Situation changes if you have rental properties. Because you should have those in an LLC (If you don’t talk to me about that separately.) Your interest in an LLC is a probate asset unless you do more, so that’s probably trust time.  

It’s also trust time if you have kids, because once you have children. They become your… or you know they have an intestate share right away, even though they are minors and can’t. You know, do anything with it.  

So if you don’t want to accidentally leave a ton of property to children requiring a guardianship, if there’s no surviving adult responsible. And if you don’t want to leave a bunch of money to someone the day they turn 18. (Usually, Yikes, But, you know it’s your own decision to make, I guess) A revocable trust makes tons of sense for married couples with children because it lets you set thresholds for distributing your assets to your minor children over their lifetime. You can set up discretionary educational trusts in your revocable trust. So you know, usually that’s worth it. UM. It’s a lot more flexible, a lot more private, a lot easier to administer than a testamentary trust, which can go in a will  

(Kind of old school that some people will have a will and then the will says. Oh by the way, if my beneficiaries are minors then you know create this trust for them. It’s like, well, it’s better to have that done beforehand because then you avoid probate, you keep some privacy. And you can you can be a little more elaborate in your planning, then, too. . . . .Although there’s no theoretical limit, I guess, even in a testamentary trust, but… Personal preference I suppose. Anyway, that’s an aside.)  

So those are some basic those are some basic schemes you know for single people. UM, it can be easy. Hopefully you can do it, most of it, outside of probate and then just a simple will. For married couples, and especially married couples with children, it makes sense to get some trust in place there.  

And again, business interests are a biggie, so if you’re, if you’re running your own business, that needs special thought and that instantly puts you into the “Yep, have a plan.” Versus just a W2 wage earner. Or two.  

So I hope you’ve enjoyed this brief overview. Obviously everybody’s personal situation is different, so come in for your planning meeting. We’ll talk about your situation and then based on what you need. You know that’ll that’ll determine. Where exactly we go from there, but that gives you an idea. Hopefully that’s enough to go on and start reading about if you want more education, but you can book online here on stouts law or you can just give me a call. Love to hear from you and talk to you about that. Thanks and bye.