Around 67% of Americans still don’t have a will, despite COVID-19 delivering a fresh perspective over the importance of estate planning for people of all ages. That’s the rather worrying headline statistic to be taken from the latest Caring.com survey, which found that it is only the younger generations that have increasingly been putting formal will arrangements in place in the past year.
Indeed, the proportion of American adults of any age with a will has actually seen a notable decline in recent years, with 42% of all adults having one in place in 2017, compared with just 33% now. This is particularly surprising given that two-thirds of those polled believe that having a will is “somewhat” or “very” important, and that the rise of the online will maker means it's easier to plan your estate now than ever before.
How has COVID-19 impacted estate planning?
The coronavirus pandemic may have encouraged people across the globe to more keenly consider their finances, but it doesn’t appear to have translated into action as far as wills are concerned. Indeed, despite more Americans now discussing wills with their loved ones, the proportion of those who actually have a will hasn’t changed substantially from a year ago, with this year’s figure only a slight uptick from the 32% of respondents who had a will in 2020.
At first glance, the lack of yearly change indicates that the pandemic hasn’t caused Americans to reconsider their estate planning requirements, with only a third of respondents to the survey saying it had made them see a greater need for a will, and most of those not actually starting the process quite yet. Yet this isn’t the case across all demographics, and perhaps surprisingly, the pandemic has encouraged one age group in particular to plan ahead – those under the age of 35.
Younger Americans are getting the will message
Indeed, the study found that 27% of those aged 18-34 now have a will, up from just 16% a year ago. Over a third (35%) of this age group also said they were specifically motivated by COVID-19 to start engaging with the estate planning process, and many of them obviously followed through. This is in stark contrast with older age groups, among whom just 23% of those aged 35-54 and 16% of those aged 55+ were motivated by the pandemic to begin estate planning. What may surprise even more with these age groups is that they’ve actually seen a decline in preparation in the last year, with just 22.5% of those classed as middle aged and 44% of those aged 55+ now having a will, down from 27% and 48% respectively a year ago.
The pandemic has been a key driver of this behavioural change, and with there being no definitive way of knowing who COVID-19 would irreparably impact, young Americans have been fuelled to think more about the future and focus more heavily on estate planning. This means that those aged 18-34 are now more likely to have a will than their middle aged counterparts, but it also shows that those who are most in need of having a will are increasingly unlikely to actually have one.
“There has been a greater focus on estate planning by younger Americans due to COVID-19,” says Patrick Hicks, Head of Legal at Trust & Will. “In many ways, the pandemic forced Americans to consider a new perspective on estate planning. Many younger Americans had delayed creating an estate plan by assuming (incorrectly) that estate planning is only for older people and not relevant for young, healthy people. The unknown aspects of COVID were an unexpected shock that helped many younger Americans realize that estate planning is important precisely because you can never know what the future may bring. Having a plan in place is one small step to protect yourself and your family from otherwise uncontrollable risks.”
Why people don’t have a will...
While it’s undoubtedly good news that the younger generation is beginning to realise the need for proper estate planning, the fact remains that far too few Americans are suitably prepared. Worryingly, this clear disconnect between intention and actuality could have long-term consequences, potentially meaning that estates could go to people the deceased never intended to benefit.
By far the biggest reason for failing to arrange a will was simple procrastination, with 34% of those questioned admitting that they simply hadn’t gotten around to it yet. Just over a quarter (28%) felt that they didn’t have enough assets to leave to anyone, 8% said they didn’t know how to go about making a will, and 6% said estate planning was too expensive.
...and why you should have a will
In reality, there are numerous reasons why you should make a will, not least to make sure that your estate is passed on to those you love in the manner in which intend. Having a will in place can also shorten the probate process that your family must go through and help limit estate tax liability. The rise of online will makers also means it needn’t be complex or expensive to arrange a will, particularly as you can set down your wishes at your convenience and without the expense of a legal professional.
“The pandemic has led many to look for estate planning services that are accessible without going into office buildings or public spaces,” adds Patrick Hicks. “For each of these, COVID has accelerated trends that were already in place. We expect to see these trends continue even after the impact of COVID-19 becomes less acute.”
You can be safe in the knowledge that your intentions will be acted upon and your loved ones provided for, too - online wills are perfectly legal once signed and witnessed correctly, and don’t always need to be notarized, so really are the ideal solution.
For additional peace of mind, now could also be the time to look into final expense insurance, thereby ensuring your loved ones needn’t face the prospect of funding your funeral and burial costs. If combined with the right life insurance, you can ensure your beneficiaries will be financially secure after you’re gone too.