Making smart choices about your financial life can often mean thinking about and talking about things that make us uncomfortable. The same is true when it comes to estate planning.
No one in their twenties and thirties wants to think about their own mortality since death feels decades away – YOLO! But research shows 87% of millennials don’t have a will – and 65% of parents with minor children don’t have one. Like life insurance, an estate plan doesn’t benefit you – it helps your family after you’re gone. Not having one means that your loved ones have to guess at what you would have wanted.
But why should you think about an estate plan now, and what goes into one?
Who needs a will?
It’s a myth that you only need a will if you’re rich, or over 40. You need one if you have children or pets (hello fur baby parents!), own assets like a home or investments, or if you’re married or in a common-law relationship. People typically create a will when they hit milestones like getting married, buying a home, or having a child – but even if you have investments through an app like Mylo, having a will ensures that your money goes to the right people.
If any of these apply to you, consider adding an estate plan to your financial to-do list in 2019.
Everyone needs a POA
A Power of Attorney, or POA, outlines who makes decisions on your behalf if you become incapacitated – for example, if you were in an accident. While not every millennial needs a will, everyone over the age of majority (typically age 18) should have a POA.
There are two types – a POA for Personal Care, which outlines your medical wishes (for example whether you want to stay on life support) and assigns someone to make medical decisions on your behalf, and a POA for Property, which assigns someone to pay your bills and make financial decisions on your behalf. So even if you don’t need a will, you should consider creating a POA.
Learn from the celebs who have died without a will
Celebrities like Prince and Aretha Franklin died without a will, and it resulted in drawn-out legal proceedings, with family and friends arguing over their massive estates. If you die without a will, you’re what the courts call “intestate” – and the court makes decisions on who cares for your children, and how your assets are distributed. Each province has different rules, but the bottom line is the courts are making decisions for you, vs. you being in the driver’s seat. Make sure you create a will if you need one – but also make sure you tell someone where it is (Aretha’s family found a handwritten will in the couch cushions a year after she died!).
What goes into getting a will?
At their core, wills involve choosing people for a few key roles:
- Your executor, typically a trusted family member or friend who will put your plan into action
- Guardians, who will care for any pets or minor children
- Beneficiaries, the people who will receive your assets
Wills also allow you to leave specific gifts (think a memento or piece of jewelry), leave donations to charity, and to specify funeral wishes (for example whether you want to be cremated or buried) – but those are often optional elements. It can be helpful to start thinking about who you would want to fill those roles now, so it’s easier when you actually go to create your will.
Okay fine, I need an estate plan.
Once you’ve decided to take this important step, there are a few ways to get it done:
- You can visit an estate lawyer, who can give you advice and draft it.
- You can write a will yourself (called a holograph will), although they aren’t valid in all provinces, and can carry risk since it’s easy to make errors and contradict yourself.
- You can easily create one with an online will tool like Willful as long as you have a simple estate. Willful is like the TurboTax for estate planning – it guides you through a series of about 10 questions, and in 20 minutes you can print off your will and sign it and voila, you’re done in the time it takes to watch the latest episode of The Hills.
While it’s zero fun to think about, it’s never too early to put a plan in place to help your family in case the unexpected happens. Taking 20 minutes to create your plan can give you peace of mind. While you only live once, you only die once too, so why not make sure your family is protected.
Use promo code MYLO15 for $15 off any Willful plan. Visit willful.co to get started.