Estate planning sounds like something that should only concern senior citizens. After all, it’s a system of making sure that your assets wind up in the hands of your beneficiaries as quickly and easily as possible. And who has an estate these days? The word implies plenty of wealth.

But the fact of the matter is that estate planning is just as important to the young and the less-than-wealthy as anyone else. For one thing, estate planning these days can include the documents that state how you want your medical and financial affairs handled if you’re incapacitated. For another thing, estate planning is just as useful as an insurance policy: it gives you a way to make sure that your family is taken care of in a worst case scenario.

Incapacitation and Powers of Attorney

A ‘power of attorney’ is a document that appoints someone to make decisions in circumstances where you can’t. It can be for relatively simple situations: if you’ll be undergoing anesthesia for surgery, it’s common practice to have sign a power of attorney allowing a relative or friend to make medical decisions for you while you’re under. If you plan out your power of attorney in advance, though, you’ve got more options on how you can limit or divide your power of attorney. In case of accidents, you can also make sure that the person you want making decisions for you will be in charge — rather than the person who legally gets the responsibility (typically a spouse or parent) if you don’t have a signed power of attorney already in affect.

With estate planning, you can also set out directives about how you want to be cared for if you become ill. Living wills and advance directives can help you make sure that you get the type of care you want, no matter what. However, the laws regarding advance directives can vary significantly by state, so you’ll want to be aware of your options in your home state.

Planning Around Children

If you have children, especially young ones, it’s crucial to put at least some sort of estate planning into place. At a bare minimum you can state which friend or relative you want to care for your children in the event you cannot. Depending on who you expect to care for your children, you may also want to set up your estate so that money will be available to cover your children’s needs.

Tools like trusts can make a major difference in how much of your estate may go to taxes, as well as how safe the money you leave to minor children. However, it’s important to consult with a lawyer who can help you through the specifics. If you expect any trouble in how you plan to set up your estate, or you have a blended family, it can be doubly important to work out problems with your estate — long before you can’t make decisions on the matter.

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