Estate planning is as important for singles as it is for married couples. Though singles cannot utilize the double federal estate exemption, proper estate planning will help avoid probate.
If a single person without an estate plan passes away, probate won’t be put off or postponed. The person’s assets will be divided according to the state law between their closest relatives, such as nephews, nieces, parents, and siblings. This distribution may not reflect the person’s desires.
If you are single, creating an effective estate plan must top your priority list. Estate planning involves writing a will. Your will must contain the name of beneficiaries (the people who you want should receive your assets).
If you have minor children, you can appoint a legal guardian, someone you can trust to take important decisions on the behalf of your kids until they attain the age of majority. You can designate a beneficiary for life insurance and retirement accounts.
When relationship dynamics change, remember to update beneficiary designations. Remember, the person designated as the beneficiary on these accounts will receive the assets, irrespective of what your will says about the accounts. If, for instance, your father is listed as a beneficiary on your savings account, but you will identify your mother as your beneficiary, the former will benefit from the account.
Estate planning allows you to appoint a person (a family member, a close friend, or anyone else you can trust) to take important healthcare and financial decisions on your behalf if you become physically or mentally incapacitated.
Be very careful when appointing a person to be your decision maker in matters of medical treatment. Choose someone who understands your wishes and respects them. You can appoint the same person to take important financial decisions on your behalf; however, this is not mandatory.
If a single person does not have a close relative or friends, they can consult their estate planning attorney in Santa Rosa to incorporate philanthropic giving into their estate plan.
Singles who are concerned about high estate taxes can create different types of trusts or donate to a charitable organization. If you nominate minor beneficiaries, set up a trust to fund their education. Many people set up a trust to distribute assets in smaller increments over time rather than a lump sum.
Whether you are married or single, consider creating an estate plan a priority, not an afterthought. Creating an estate plan is the most effective way to ensure your assets go to the people you choose, and a person you trust is in charge and has the necessary authority to take important decisions on your behalf.
Johnston Thomas Law is a team of experienced estate planning attorneys in Santa Rosa. Once we understand your estate planning goals, we will create a plan that checks all the right boxes for you. To consult one of our attorneys, call us at 707-545-6542.