College is an exciting time for young adults, full of opportunities for growth, exploration, and learning. It is a time when students take on more responsibility for their own lives, including their financial affairs. However, many college students don’t realize the importance of estate planning. Estate planning is the process of making arrangements for the distribution of one’s assets after death. It may seem more appropriate for older individuals, it is actually something everyone, including college students, should consider. In this article, we discuss why college students need estate planning.
Protect Your Assets
College students often have limited assets, but they still need to take steps to protect what they do have. For example, if a student has a bank account or a car, they need to make sure that those assets are distributed to the appropriate person if something were to happen to them. By creating a will or trust, a student can specify who receives their assets and ensure that their wishes are carried out.
Protect Your Health
Estate planning isn’t just about distributing assets after death; it’s also about making sure that your wishes are followed in the event that you become incapacitated. If the college student is an accident or become ill, and without proper estate planning, their medical decisions are left up to someone else unless they take the right steps before. A college student should create a healthcare proxy. This is also known as a medical power of attorney. The healthcare proxy is a document that permits for the student to designate someone to make medical decisions on their behalf if they are unable to do so themselves.
Probate is the legal process of administering a deceased person’s estate. Probate is often a lengthy and expensive process that can tie up assets for months or even years. With proper estate planning, a college student, or anyone, avoids the probate process entirely. This means that their assets are distributed quickly and efficiently, without the need for court intervention. Learn more about probate in our two-part article series – check out Part 1 here and Part 2 here.
Provide for Dependents
While most college students are not yet parents, they may have other dependents that they need to provide for. For example, a student may have a younger sibling or a parent with a disability who relies on them for support. By creating an estate plan, a student can ensure that their dependents are provided for in the event of their death.
If a college student has children, they want to make sure that their children are taken care of if something were to happen to them. By creating a will, a student can name a guardian for their children. This ensures that their children are cared for by someone they trust and who shares their values. While putting named guardians for a will is an important step, it’s not the only one. It’s essential that you also name the guardians in documents outside a will. A will only goes into effect upon your death, and does nothing to protect your kids in the event of incapacity.
Protect Your Digital Assets
Many college students have valuable digital assets, such as social media accounts, email accounts, and online banking and investment accounts. It is important to make sure that these assets are protected and distributed according to the student’s wishes. By creating an estate plan, a student can specify how their digital assets should be handled after their death.
Planning for the Future
Estate planning is not just about what happens after death; it’s also about planning for the future. For example, a student may want to create a trust to provide for future generations or to support a charity. By creating an estate plan, a student can ensure that their wishes are carried out long after they are gone. By speaking with us at The Palermo Firm, we can review your assets, family dynamics and values to keep your family out of court and out of conflict. Don’t wait, contact us today to get started!