When is a good time to start planning for your future? In reality, as soon as you turn 18 and are seen as an adult according the legal system, you need to be able to take on a lot more than just being able to vote in the upcoming election. This is a turning point for when you separate from your parents; your legal, healthcare and financial decisions are your responsibility now.
Because of this, you’ll want to appoint a trusted individual as your financial power of attorney; this person can be a parent, mentor or lawyer – anyone who you trust to make important decisions on your behalf when you’re incapable of making them yourself. This can range from being in a coma to being out of the country and unable to renew your car’s title and registration. Similarly, you should also appoint a healthcare power of attorney who will be able to make decisions for you if you become mentally or physically unable to make medical decisions for yourself.
Estate Planning for Young Adults
When you graduate college and head to your first job, you may start a 401k plan and put a healthy portion of your paychecks into a savings account. A few years down the road, you may even eventually buy a house or a condo in the city. However, If you are single with no dependents and something happens to you, such as death or becoming mentally incapacitated, what will happen to your assets and property? The obvious answer when you’ve started a family is that these things will go to your immediate spouse and children, but it becomes less clear as a single adult. To be prepared in case of an unfortunate event that leaves you unable to appoint your assets to those you choose, you’ll want to meet with an estate planning attorney who can walk you through your options. Setting up a will, for instance, is a great place to start. As you grow older and get married or have children, you can change your documents according to your new circumstances; however, the important part is to get started.
Life and Long Term Insurance
You may also want to consider purchasing things like life and long term care insurance starting at a very young age. Although you hopefully won’t be needing these for decades down the line, it’s much cheaper to start in your twenties than to wait until you’re ready to retire. You can also still be covered if you develop a medical issue, which would be considered a pre-existing condition if you wait to buy these things until it’s too late. Check with a specialist dealing with long term care and life insurance to find out how much the premiums would be.
It’s never too early to be prepared; the younger you’re able to begin planning, the better you can protect your family and future generations.