I frequently counsel families on the benefits of continuing trusts. The old method of giving children outright distributions or staging the distributions at ages 21, 25 and 30 not only increases the likelihood of the beneficiary making a poor decision with the funds, but doesn’t offer any of the protective benefits of trusts. A recent article on Wall Street Journal explains why adults are better fit to make important life decisions in their late 20s rather than earlier in the decade.
These days adults in their early 20s are still treading the road towards self-discovery. This delayed development in 20-somethings worries most of their parents, whose generation had already found them married and settled down between the ages of 20 to 22. However, Dr. Jeffrey J. Arnett, a professor of psychology at Clark University in Worcester, Mass., has this to say: “It should be reassuring for parents to know that it’s very typical in the 20s not to know what you’re going to do and change your mind and seem very unstable in your life. It’s the norm.”
New research into “emerging adulthood”, a term coined by Dr. Arnett in 2000 to define the stage between the ages of 18 to 29, shows that the brain is better equipped to process major life decisions when a person has reached their late 20s. While it was once thought that the brain should be fully developed after puberty, recent studies indicate that it is still expected to mature until a person’s third decade. The prefrontal cortex, which is the part of brain that can help a person plan ahead, balance risk, and control impulses, is one of the last regions to be fully developed.
Some experts believe that the expected change and uncertainty during the young adult years is the cause of the high rates of stress, anxiety, and depression between the ages of 18 to 25. It is a stage in life where 20-somethings are susceptible to alcohol and drugs, and the rates of motor-vehicle accidents, depression, and mental illnesses are at its peak. These trends tend to ease by the late 20s, when the brain is more optimal and the average adult settles down into marriage and their chosen career path. Most adults also achieve financial independence at this time.
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