Single, child-free folks may believe estate planning is not necessary if they don't have a family to worry about. Or they may believe that getting their affairs in order is a complicated, stressful sea to navigate. None of this is the reality, though. Simply put, everyone needs an estate plan.
WHY YOU NEED AN ESTATE PLAN. First things first: Having a comprehensive estate plan in place is important for everyone, regardless of whether you have children, or you don't believe you have a lot of money or other possessions to bequeath. And "everyone" includes those who are single, many of whom may not realize the need for estate planning.
A Will is a written document that provides for the distribution of a deceased person's real and personal property. If you die without a Will (i.e., you die “intestate"), your state's laws determine where your property goes — and that may not align with your wishes.
Just because you don't have children to whom you wish to leave assets, you may have other family members, friends, or favorite charities you would like to see benefit from your lifetime of hard work. In addition to a Will, your estate plan should also include a Durable Power of Attorney, which names someone to make decisions on your behalf if you are unable to do so, whether temporarily or permanently. You may designate the same person or different people to make medical decisions and/or handle financial matters.
A Directive to Physicians (or "Living Will") is another critical document to have in your estate plan. This allows you to define the type of medical care you would or would not like to receive if you cannot communicate those wishes yourself. For example, you may stipulate that you do not want to be put on artificial life support.
5 TIPS FOR PREPARING YOUR ESTATE PLAN. The process of getting your affairs in order doesn't have to be complicated. By considering the following questions, you can be well on your way to having your estate plan ready in no time.
1. Who do you want as Personal Representative? One of the most important decisions you will make for your estate plan is who you choose as Personal Representative of your estate. The PR is the person who will carry out the provisions of your Will, so it should be someone you feel has the capacity to do so — and it should also be someone who is responsible and willing to serve, so talk with them about it first before executing your Will.
2. Who do you want to step in and make decisions on your behalf? Perhaps even more important than choosing a PR, though, is deciding who you would like to represent your interests — both financial and medical — should you become incapacitated or otherwise unable to handle them yourself. Again, this should be someone you trust implicitly to follow your wishes and to make tough decisions, especially in the event that a particular situation arises that is not covered in your estate planning documents. If you do not have a partner or you live alone, creating these documents gives you the opportunity to identify someone who will be able to advocate on your behalf.
3. Who do you want to get your stuff? Take an inventory of your real and personal property and make a list of friends and family you would like to inherit something from you — then match them up. But friends and family aren't the only considerations you should have when making your estate plan.
4. Are there charitable organizations you support? Many people without children leave money to their favorite charities, although in some cases, it's more tax advantageous to do so during one's lifetime in order to maximize deductions. You can even set up a charitable Trust with funds to be distributed to the charity of your choice over a specific amount of time.
Even for donations after death, there are ways to make sure the receiving organization doesn't get hit with huge tax bill, so this is a good area to plan out with your lawyer.
5. Are your pets provided for? Your pets are probably like family to you, so you will appreciate the peace of mind that comes with knowing they'll be okay once you're gone. Aside from choosing someone to take possession of them, in Washington you can also put money in a Trust earmarked for their care.
No one knows what the future will bring, and wouldn't you feel better knowing that your wishes will be followed in the event of your death or incapacity and that someone you trust will be in charge of your affairs should you become incapable of handling them yourself?
There's no time like right now to get your estate plan in order. We have been preparing estate plans for clients since 1996 and are licensed to practice in Washington and Idaho. Give us a call today to set up an appointment to discuss your estate planning needs.