Millennials and Young Adults
Ask yourself this: If I got into a car accident tomorrow and became incapacitated, who would make medical decisions on my behalf? Do you know if that person’s decisions would be in line with your wishes? Do you know who would pay your bills? If these questions concern you — and they should — it’s time to start thinking about some basic estate planning even if you don’t have a spouse or children or a substantial amount of wealth to pass on.
That’s right; even young, single people need to do some estate planning. The good news is that you don’t need an elaborate, complex plan at this point. You can set up a plan for your medical and financial affairs by executing two simple documents — an advance health-care directive and a durable power of attorney — and you can do it in less than 30 minutes.
For many young adults gaining independence from their parents for the first time and getting a grip on how to be financially smart can have a steep learning curve. For someone who isn’t making a steady income yet, or doesn’t know about the potential pitfalls, how can you build a foundation for a healthy financial future? Here are some tips for young adults to establish good financial habits early
You know you should start saving for retirement before you turn 40. What can you start doing today to make that effort more productive, to improve your chances of ending up with more retirement money, rather than less?
If you are younger than 35, saving for retirement may not feel like a priority. After all, retirement may be 30 years away; if your employer does not sponsor a retirement plan, there may be less incentive for you to start.
Even so, you must save and invest for retirement as soon as you can. Time is your greatest ally. The earlier you begin, the more years your invested assets have to grow and compound. If you put off retirement planning until your fifties, you may end up having to devote huge chunks of your income just to catch up, at a time when you may have to care for elderly parents, fund college educations, and pay off a mortgage.