Discussions regarding estate planning often are focused on married couples with children, but having a proper plan in place for a single person is equally as important. Major legal problems can result from not having your assets in order.
Single people often own assets individually in their own name. Some of their assets may be owned as a joint tenant with rights of survivorship. Assets such as retirement and life insurance will be distributed according to the beneficiary designation.
According to an article by Forbes, “How these varying assets are titled and how the beneficiary designations are prepared will directly impact who will get control of the assets and how they’ll be distributed at the individual’s death.”
When a single person passes away without an estate plan, their possessions will be distributed according to the laws of their state. The law usually states that their assets will be distributed to the closest living relative.
If there are no relatives, these assets will go into the hands of the state.
Below is some advice to singles regarding your estate planning essentials:
- A will is necessary and is considered the centerpiece of your estate plan. Make certain, as a single person, you choose the appropriate executor of your will.
- A durable power of attorney is necessary if you become ill and unable to manage your finances and other affairs.
- A healthcare directive is necessary to communicate your medical wishes.
- Have up to date and accurate beneficiary designations.
- You may want to consider a trust which holds assets for the benefit for a third party beneficiary.
- Speak with an estate attorney or financial advisor to help create your estate plan.
As a single person, make estate planning a priority that will help your friends and family members in case you pass away.