Estate planning is an important financial step that many individuals consider at various stages of their lives. One common misconception is that there is a specific age at which it becomes too late to begin this process.
However, the truth is that the complexity of your financial situation and your desire to secure your assets and legacy for your loved ones matters more than age.
Late-life estate planning
About 46% of U.S. adults 65 and older have a will. If you have not started estate planning earlier in life, it is never too late to do so. Seniors can still benefit from creating a plan to manage their assets and ensure their distribution as seniors intended. Late-life estate planning may also involve making arrangements for health care decisions and end-of-life care.
Middle-aged individuals often have more substantial assets, such as a home, investments and retirement accounts. Middle age is a wise juncture to assess your estate planning needs, as you may have dependents or specific wishes for the distribution of your assets. At this stage, creating a will or trust can help protect your loved ones in case of unexpected events.
While it is never too late to start estate planning, beginning the process at a younger age can offer several advantages. Firstly, it provides ample time to accumulate and manage assets, ensuring distribution according to your wishes. Additionally, early planning allows you to establish trusts and make decisions about guardianship for minor children.
Complexity and goals
The complexity of your financial situation plays a significant role in determining when to start estate planning. Regardless of age, if you have substantial assets, it is advisable to begin planning sooner rather than later. Your goals, such as providing for your family, minimizing taxes or supporting charitable causes, also influence the timing of estate planning.
Regardless of when you start estate planning, review and update your plan periodically. Life events, such as marriages, divorces, births and deaths, can impact your wishes and financial situation. By keeping your estate plan current, you ensure that it accurately reflects your desires.