How Far in Advance Can I Begin My Estate Planning?

You can create your estate plan at any time. Most people put it off too long, but there are many who choose to begin the process sooner rather than later. Why? Because you never know when life-changing medical or financial emergencies can strike requiring someone else to manage your affairs during your lifetime.

When Should You Start?

When to start planning for your estate depends on your goals and the size and complexity of your estate. If your estate involves business interests, multiple properties, significant investments, or complex family dynamics, creating a comprehensive plan may require more time.

While there is no specific age requirement to create an estate plan, at a minimum, you should create financial and medical powers of attorney when you legally become an adult. Once you accumulate some money and property, you should create a more comprehensive estate plan. Many young adults start families and have minor children who rely on them for support, which could require establishing a guardianship for the children should something happen to both parents.

What Are Your Concerns?

Estate planning can prepare you for medical emergencies such as accidents and illness that could leave you temporarily or permanently incapacitated and unable to speak for yourself. Advance healthcare directives including living wills and medical powers of attorney should ideally be established while you are still in good health to ensure your wishes for care and treatment are known.

You may also consider various aspects of your life, money, and property that hold significance for you and your beneficiaries. These considerations can go beyond financial resources and encompass your broader legacy and personal values, and they should be part of your estate plan.

• You can create a family mission statement to help guide future generations toward a goal that is meaningful to you, such as environmental responsibility or giving back to the community through faith or philanthropy.
• You can set conditions that reward specific behaviors such as building a productive career or business, maintaining health and wellness, or expanding financial literacy.
• You can contribute to a 529 plan or directly to education institutions to highlight the importance of a quality education for children, grandchildren, and great-grandchildren. If one beneficiary does not use the funds, it can often be passed to another.
• You can start a foundation or limited liability company to provide direction and purpose for family wealth. Encourage certain family members to fill roles within the organization that they may enjoy or that match their natural talents.

Different Stages of Life and Circumstances

When significant changes happen to you or your family, they become reasons to create an estate plan or update an existing one. Your estate plan is a living set of documents, not a one-and-done task to cross off your list of things to do. Here are a few events that require contacting your estate planning attorney:

• Marriage and divorce
• Birth and adoption
• Death of a spouse or child
• Purchase or sale of significant property and investments
• Starting a business
• Receiving an inheritance

Depending on your current stage in life, you may be able to create an estate plan to suit your situation that only requires a few essential documents. For example, when planning at a younger age, your plan may only include a will and medical and financial powers of attorney. To be sure, your plan will evolve to include many more details that require careful consideration throughout your lifetime and may require establishment of additional documents, such as advance directives for end-of-life care and the use of a trust to protect your hard-earned money and allow you to take advantage of more advanced planning strategies.

Each decision you make during the estate planning process will significantly impact your money and property, your loved ones, and the future distribution of your wealth. That is why estate plans should be routinely reviewed to ensure they continue to align with your goals, are relevant to your current situation, and keep up with the legal and financial landscape.

What Immediate Circumstances Are Urging You to Plan?

Your stage of life could determine the timing and urgency of your decisions. Certain events may also create an urgency to plan.

• If you are expecting a child, you may want to establish guardianship arrangements through your will or a separate document, designate a trustee to manage accounts and property on your child’s behalf, and create a plan to provide for their education and upbringing.
• If you are getting ready to close on a new vacation home, you may wish to consider how the property fits into your broader estate plan and legacy.
• If your grandparent or other family member has failing health and recently shared documents with you that name you as a beneficiary of their considerable estate, you can begin to align anticipated funds with your overall financial goals.
• If you are an entrepreneur or business owner ready for retirement, you can outline a succession plan, identify key individuals who will take over your business, and establish strategies to ensure the continuity and success of your business.

Is It Possible to Plan Too Far in Advance?

There is a balance. Estate planning documents, such as wills and trusts, should be clear and concise to avoid confusion and disputes. Planning too far in advance might lead to numerous “ifs” and conditional clauses that can complicate or confuse your intentions. The more complex your situation becomes, the greater the potential for misunderstandings among your beneficiaries and those responsible for executing your wishes.

Life is inherently unpredictable, and your financial situation, family structure, and personal goals may change rapidly. Many foundational estate planning documents, such as wills and revocable living trusts, can be amended or revoked during your lifetime. Planning specific details too far in advance might result in more frequent revisions and unnecessary costs.

Estate Planning Is an Ongoing Process

While there is no specific timeframe for creating your estate plan, starting early and periodically reviewing your plan is recommended. Focus on what is important today, knowing your estate plan is flexible and adaptable to future changes. Doing this ensures your plan will always reflect your values, provide for your loved ones, and secure your legacy.

An experienced estate planning attorney can guide you through the process of developing a plan that suits your unique circumstances and goals.