Most people would prefer that their estates not be donated to the state. Even when there are no living blood relatives, an estate plan makes it possible to designate friends, partners, and charitable organizations as beneficiaries.
Most people have heard of a Last Will and Testament, otherwise referred to as a will. Some are also familiar with health care directives, financial durable powers of attorney, and the various types of trusts. All these documents can be used in estate planning, depending on certain factors such as children, wealth, assets, taxes, and others. For those who are not married, what should you know about estate planning for the single person?
What is Estate Planning?
Many single people have children, but even those who do not have other loved ones such as parents, siblings, and other family members, friends, or even charities they may want to leave assets to upon their passing. Estate planning for the single person ensures that properties, assets, and financial obligations are handled according to their wishes. Estate planning involves a set of documents designed to help manage an individual’s affairs should they become incapacitated. In other words, a person’s estate will be distributed according to their wishes when they pass. Estate planning is also used to eliminate or reduce taxes upon death.
An experienced estate planning lawyer should be retained to ensure that your estate plan, will or trust is drafted and executed properly, and with your best wishes in mind.
Advantages of Estate Planning for the Single Person
Individuals who are not certain about estate planning should be aware of the advantages of creating an estate plan. These include:
- Ensuring assets are distributed properly upon death – no court resolution, reduced discord within the family
- Plan for any type of physical or mental incapacity
- Support a charitable organization or local cause
- Provide for family members that may need assistance – college tuition, child with a disability, etc.
- Minimize estate taxes – beneficiaries keep a greater amount of assets or money
- Ease burdens on loved ones – funeral costs are an added burden for family members who are grieving
- Outline a succession plan for those who own businesses
- Choose guardian to raise and care for minor children
According to the American Association of Retired Persons (AARP), in 2017 approximately 78% of millennials and 64% of Generation Xers did not have a will. Planning for incapacitation or for the end of life is essential.
Living Trusts
Living trusts are one component of estate planning for the single person that may be considered along with a will. A living trust is an option for single people who are divorced, widowed, or have never been married. Living trusts allow the testator (person making a will or other estate planning document) to place their assets in a trust and choose a representative who, upon the testator’s death, will transfer the assets to chosen beneficiaries. For those who are single, a living trust makes it possible to avoid a court-supervised conservatorship should you become mentally debilitated. This type of trust is revocable, which means changes can be made to the document during the testator’s lifetime. Living trusts can be transferred to beneficiaries without going through the court probate process, according to The Judicial Branch of California Courts.
What Happens When There is No Estate Plan?
In California, those who are single and pass without a will or estate plan in place risk having their assets or estates distributed to “heirs at law,” which means family members if any are living. An estate may be distributed in this order without an estate plan:
- Children, if any exist
- Parents
- Siblings
- Nieces or nephews when siblings have passed
- The state of California when no heirs can be traced
Most people would prefer that their estates not be donated to the state. Even when there are no living blood relatives, an estate plan makes it possible to designate friends, partners, and charitable organizations as beneficiaries.
Medical Power of Attorney in Estate Planning
A medical power of attorney is essential for singles who are not married. When someone becomes incapacitated, they are incapable of making their own decisions regarding medical care. While one spouse often makes difficult decisions in life-and-death matters on behalf of the other, this is not the case with single people. A single person may want to appoint an agent who can make difficult decisions. This may be an older child, sibling, parent, or even a trusted friend. Some individuals do not want to be left on life support indefinitely or resuscitated.
Consider Scheduling a Consultation with Kushner Legal
Creating an estate plan is important regardless of whether someone is married or single. Without a will or living trust an individual’s estate will be distributed in court, a process that can take more than a year in some cases. Families may argue and become estranged. Those interested in learning more about estate planning for the single person may want to consider visiting with Kushner Legal at (310) 279-5166.
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