For those who are single or childless, estate planning options are vast and often complicated. It is estimated that over 17 million people who are retirement age are unmarried or childless facing this very dilemma. However, a new wave of estate planners are now facing the same issues of those retirees – the young, wealthy, and childless.
Since the tech boom in the 1990s, a considerable number of young entrepreneurs are becoming millionaires and billionaires. Due to their financial circumstances, these people are considering financial and estate planning at a much younger age. The vast majority of this younger generation is childless, some are unmarried, and all are considering what will happen to their wealth when they are gone. Because of this shift in wealth, estate planning attorneys are now stressing income, instead of age, as a more reliable metric for when you should be drafting a plan for your estate.
The most important thing to this new generation of estate planners is flexibility. When planning for the future at this age, there is a higher chance of changing circumstances both personally and financially. The probability of starting a family or having swings in finances is much greater in a person’s 20s and 30s than at the typical retirement age. Estate planning attorneys are now coming up with new and flexible options for this generation of young, wealthy, and childless clients.
Besides providing for extended family and loved ones, the most popular option is charitable donation. Many want to participate and donate to charitable options like the Giving Pledge without locking into a long-term commitment. One way to do this is through a donor-advised financial fund which allows the donor to make periodic contributions at their discretion without a mandated dollar amount or period of time. Another benefit of such funds is that the donor receives tax breaks immediately and does not have to go through the messy paperwork typical of such major gifts. Another option is to plan the estate with language that provides for a potential family legacy while leaving a portion or the remainder of the estate to another organization.
With the trend of young, rich, and unattached people planning their estates at a new age combined with the fairly recent addition to estate planning of digital assets, attorneys are reevaluating the typical methods of estate planning and are coming up with innovative ways for people to plan for the future. However, these new options are not just for the young, wealthy, and childless wishing to plan their estate. Everyone can benefit from these new possibilities in estate planning, and by speaking to an experienced estate planning attorney you can incorporate these ideas into your plan.