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Millennials: Do you have an estate to protect?

As a millennial, you are starting out with greater economic challenges than previous generations. Between massive student debts and the persistent bad economy, young people between the ages of 18 and 35 have legitimate financial concerns. After all, with increasing lifespan, the millennial generation could expect to be working for many decades, perhaps beyond the current retirement age.

Do you have a plan for your retirement? How can creating an estate plan now help you protect yourself later? Keep reading.

Step 1: Start an estate plan

The fact of the matter is that it is never too early to start estate planning. Everyone has an estate of some sort or another, including your home, car, bank accounts, life insurance, and various physical possessions. Death can come at any time, too soon, either because of an accident or sudden illness, or much later, because of the accumulated burdens of old age.

A good estate plan should involve the transfer of your estate to a person, persons or institutions (such as a charity) after your death with the least amount of hassle and the least amount of expense, such as lawyer's fees, probate costs, and taxes.

Your estate plan should also settle any final expenses you might have, including burial costs, and any payment of outstanding debts that might otherwise prove to be a burden to your loved ones.

Step 2: Update your plan - and consider building what you want to protect

Estate planning is a process and will need changing from time to time as you undergo changes in your life, when you get married, have children, if you get divorced, and when you retire. You will have to provide for the care of your minor children, add or change beneficiaries, and so on. If you become disabled, an estate plan can help to provide for your long-term care as well.

One pressing reason to create an estate plan early is that it forces you to make decisions about your future. When you start drafting a will and considering what and to whom you want to leave things, you might decide that you want your estate plan to be a bit bigger. You might think about whether you have the assets to help you get through retirement, let alone an "unexpected period of incapacity."

What can you do to increase the size of your estate?

· Life insurance: Not only will having a life insurance policy alleviate the burden for loved ones should something unexpected happen, many of these policies also have cash value that you can use when purchasing a home, buying a cabin or paying for your future child's college.

· Employer-sponsored 401k: You have the new job - one that you might even call a career at this point. Many employers will match the money you put into your account up to a certain percent. Take advantage of this. When you accrue interest on the account, it is like getting free money.

· Roth IRA: The money you put into a 401k is tax-free, which is a benefit now. It will be taxable later. You can compliment your 401k with a Roth IRA. While your money is less valuable now (taxed before you put it in the account), it is much more valuable later with a tax-free status.

These are only a few ways to grow your hard-earned wealth. The point is, think about planning an estate so that you have something to protect with a good estate plan.

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