What estate planning issues are of particular importance to single individuals?
Having a capable estate planning attorney at your side is essential for everyone with substantial accumulated assets. For the most part, estate-planning articles seem to focus on married couples. Even second or third marriages often get more attention than needs and issues relevant to single members of our society. Nonetheless, the Bureau of Labor Statistics reported in 2014 that 50.2 percent of the U.S. population was single (compared to 37.4 percent in 1976).
What happens to your assets if you die as a single person without a plan in place?
While if a married individual dies intestate (without a will), that person's assets usually go to his or her spouse or children, if a single person dies intestate his or her beneficiaries are determined by the state. Typically, the government passes those assets on to the person's closest relatives, such as children, parents or siblings. Since you may have strong feelings about your relatives that don't follow direct bloodlines, working with a qualified estate-planning attorney ensures that your assets go to a person you consider worthy.
If you have no living relatives, your assets may be taken by the state. Since, if you are like the vast majority of people, you probably don't see this as a good option, it is best to work with an estate-planning attorney to make sure your personal wishes are carried out and that the estate you've accumulated is passed to a person or institution you believe to be deserving.
Essentials of Estate Planning for Singles
When planning for the disbursement of your assets after you pass away, you should consider not only who your beneficiaries will be, but who you want to make responsible for decision-making if you become mentally or physically incapacitated.
The following are essential pieces of the estate planning puzzle:
1. The will, in which you name guardians for any minor children and assign an executor. The role of your executor is to guide your estate through probate, the process supervised by the court in which your assets and their distribution are accounted for. It is always wise to choose an executor who is stable and reliable. If you don't have a friend or relative suited to be your executor, you may choose a third-party, such as an attorney.
2. The durable power of attorney, in which you appoint someone to manage your affairs if you become incapacitated. When choosing this person, it is important to consider not only trustworthiness, but financial savvy.
3. The Healthcare directive or medical power of attorney, in which you spell out your medical and life-support wishes, naming someone you trust to make medical decisions if you are unable to do so.
4. Updated beneficiary designations to determine who will receive your benefits, including life insurance and retirement plan assets.
5. Estate Taxes which don't apply on a federal level unless your estate exceeds $5.43 million, but vary on a state level from one state to another.
Depending on your specific circumstances, you may want to leave a substantial portion of your assets, or your entire estate, to a charitable institution. Whether you wish to leave a legacy that supports those less fortunate, the arts or education, your estate-planning attorney will assist you in making your wishes come to fruition.