We have all been deeply affected by the COVID-19 pandemic in many ways. From an estate planning perspective, it has underscored the fragility of life itself.
If the 2021 Caring.com survey is any indicator, it has gotten the attention of younger adults, but others have continued to shirk the responsibility.
Caring.com conducts surveys on an annual basis to gauge the estate planning preparedness of American adults. Even though death is one of the two certainties of life, most people do not have any estate planning documents at all.
Over the last couple of years, the percentage of people with estate plans has been dropping, but an interesting trend emerged this year. In 2019, 18 percent of people between the ages of 18 and 34 had plans in place, and it went down to 16.4 percent last year.
This time around, the figure is 26.8 percent, and this is higher than the 22.5 percent of respondents in the 35 to 54 age group that have wills or trusts. Surprisingly, only 44 percent of individuals that are 55 years of age and older have estate planning documents in place.
Participants were asked if they were motivated by COVID-19 to take action, and 45 percent of folks in the youngest group responded in the affirmative. The figure was 35 percent for the middle group, and 28 percent for the oldest respondents.
Estate Planning for Younger Adults
It is good to see more younger adults taking this responsibility seriously. We all know that people do not usually pass away when they are in their 20s or 30s, but there is another consideration.
A lot of couples in this age group have minor children, and it typically takes two incomes to make ends meet in our society. As soon as you have people relying on you, estate planning becomes an absolute must.
You should carry sufficient life insurance and term life insurance is very affordable. And if you have dependent children, at a minimum you should designate a guardian in a simple will. That is the bare essential, but your plan should be far more comprehensive.
Advance Directives for Health Care
We have heard a lot about mechanical ventilation over the last year or so, and this is just one of the life-support measures that can be implemented. When you plan your estate, you should consider the matter of life-support. You can state your preferences in a living will.
Other medical situations call for decisions to be made if and when you are unable to communicate. In a durable power of attorney for health care, you can name someone as your health care proxy to make decisions for you.
The Health Insurance Portability and Accountability Act (HIPAA) was enacted in 1996. A provision contained within it prevents doctors from sharing health care information with anyone other than the patient.
Your plan should include a HIPAA authorization form to give your family, especially your health care representative, the ability to access your medical information.
HIPAA protections apply to all adults, even 18-year-olds. If you are the parent of children 18 or older, please encourage them to sign one of these forms so you can speak freely with their doctors.
Take Action Today!
Most respondents to the survey stated they knew estate planning was important, but they failed to take action for one reason or another. A significant percentage said they simply did not know where to begin and felt it was all a bit overwhelming.
This is understandable, but you are here. You already know where to begin and that action is definitely required.
You can schedule an appointment at our Oklahoma City estate planning office by calling us at 405-843-6100. If you would rather send us a message, please fill out our contact form and we will promptly get back in touch with you.