Estate Planning for Young Adults

January 21, 2022

by Kayley Lew, Esq., Bailey Cavalieri (with contributions from Jon Murphy and Brittany Stephen)

If we’ve learned anything these past few years, it’s that life is short and can take an unexpected turn quickly. Many middle-aged individuals have seen this life lesson in action and have taken the time to confirm that their estate plans are in order. Questions such as “Who is my health care power of attorney? Who will take custody of my minor children if something happens to me? What will happen to my house and personal belongings when I die?” have likely passed through their mind. However, young adults should be asking these same questions.

Although some young adults may not have any children or real estate to think about yet, all young adults need to think about who they want to designate as decision-makers if something happens to them or they cannot make decisions for themselves. While estate plans are tailored to an individual’s circumstances, all young adults 18 years or older should strongly consider having the following documents in place.

Ohio is an “employment at will” state, which generally means that, absent an agreement stating otherwise, an employer may terminate an employee at any time, for any reason. As such, an employer may terminate an employee for their speech or conduct outside of work.

A Health Care Power of Attorney allows a person to designate who they want to be making health-related decisions on their behalf in the chance that the individual signing the document cannot, for some reason, make those decisions for themselves. When an individual turns 18 and attains the age of majority, their parents are no longer entitled to any of their medical information just because of their parent-child relationship. Thus, it is important to execute a Health Care Power of Attorney to make sure that only those you want to be making decisions on your behalf can access such protected information and make those decisions in unfortunate circumstances.

A Durable General Power of Attorney, or Financial Power of Attorney, allows a person to designate who they want to make financial decisions on their behalf. One key difference between this document and the Health Care Power of Attorney discussed above is the fact that this document usually takes effect immediately upon signing (but this can be changed). Therefore, whoever the signer designates as the person to have this Power of Attorney will usually have power right away to manage the signer’s finances.

No estate plan is truly complete without reviewing and, if necessary, updating Beneficiary Designations to confirm who an individual’s preferred beneficiaries are with respect to their various assets, including investment accounts, retirement accounts and bank accounts. Ensuring all beneficiary designations are updated and complete will help allow a person to ensure that their family members will avoid the costly and time-consuming probate process.

Lastly, a Will is a document that allows a person to designate who will take title to their probate assets (those which have no beneficiary designated) and who will serve as their executor to settle their estate upon the individual’s death. It doesn’t matter how many possessions an individual has – everyone should have a Will in order to avoid leaving assets to the “default” beneficiaries imposed by state law, who may or may not be whom the individual would designate – and also to avoid any potential conflicts over who would serve as executor.

There are certainly other documents that can play a part in someone’s estate plan, but enacting the above-mentioned documents will allow unexpected or inconvenient circumstances to be less burdensome and uncertain.