This excellent article from Bankrate.com highlights the need for singles
to write their estate planning documents. Often people consider writing their
Will once they get married, or they have children, and this article explains that
once these events happen, the law will usually take care of loved ones should you
die without a Will. However, singles, who often have a larger estate than
they think (accident insurance and life insurance policies will pay out), do not
always have an obvious beneficiary. In 30 minutes using the services at this
website, your estate planning needs can be taken care of.
Young, Single and in Need
of an Estate Plan
December 3, 2004
Jay MacDonald
Bankrate.com
Remember that hilarious episode of "Friends" where Ross convinces
Rachel, Phoebe and the others to sit down and write their wills and designate durable
power of attorney to each other in the event something should happen to them?
Of course you don't; it never happened. Come on, who would
believe that?
The sorry fact is, singles don't bother with estate planning,
period. Heck, part of the joy of being single is the devil-may-care, no-strings-attached
lifestyle. Even the term "estate planning" sounds like something their grandparents
would do.
Well, not to be overly grim, but you swinging singles need
to plan for the Reaper every bit as much as Mr. and Mrs. Suburbia. In fact, in the
opinion of Kyle Krull, a Kansas City attorney and estate planner, singles need it
more.
"It's even more important than it is for marrieds, and here's
why: In a marriage, it is pretty much assumed that your spouse, even in the absence
of any planning, is going to be the person that the court is going to appoint as
the guardian over your personal and health care decisions and conservator over your
financial matters.
"But if you're single, who is it going to be? If you're age
18 and over, you need to appoint the people to make your personal, health care and
financial decisions or the court is going to take a stab at it themselves, and it
may not be the party you would want."
Consider these two scenarios. If you're single without kids
and you die without a will ("intestate" in legalese), your assets would likely flow
to your next of kin in this order: surviving parents, siblings, nieces and nephews.
If you are divorced with children, your assets would likely go to your children
as next of kin, and should something happen to them, your assets could wind up with
your ex-spouse as their next of kin.
That's right, if you don't specify otherwise, your ex-spouse
(and his or her new spouse) could get your checks when you check out.
Now that's no laughing matter, friend.
Who'll be there for you?
When Minneapolis money coach Ruth Hayden asks her single clients why they haven't
addressed an estate plan, they usually plead poverty.
"Most singles figure they don't have much money, this is not
a big deal and they usually don't do planning," she says. "Usually they find they
have more than they think."
Hayden starts by adding up their assets. Singles often have
a life insurance policy through an employer, perhaps a nominal retirement account
fed by their paychecks, equity if they own a home and often assorted accidental
death benefits from credit cards and memberships.
She then explains to them who is likely to end up with this
modest windfall once their estate has been settled: a parent, a sibling, a niece
or nephew.
"Once they realize that they have these things and that their
next of kin will be in charge of cleaning everything up and then will get whatever's
left over, they pay attention," she chuckles. "That person is also going to dislike
them if they haven't made any plans. I tell my clients, if you don't like these
people, don't have a will and don't make any plans. But if you like these people,
have some order to this."
We plan in order to designate who will be responsible for our
personal, health care and financial decisions when we are no longer able to do so
ourselves. If we don't, the probate court and typically a gaggle of lawyers will
be only too happy to make these calls for us (Krull calls this the "lawyer full-employment
program"), in the process making our private affairs a matter of public record.
Krull estimates that seven out of 10 Americans have no estate
plan at all, and most of the 30 percent who do have not kept them up to date with
current tax laws. You may have every intention of leaving your nephew your Jimi
Hendrix autographed guitar, but without a will, the court is going to sell that
off in an estate sale so the money can be distributed. It can be heartbreaking to
see relatives at estate sales "buying back" family heirlooms that you fully intended
to pass along, someday.
Worse, if you are a single parent of a minor, the probate court will likely turn
your child over to your ex-spouse, the surviving biological parent, and may even
appoint him or her to manage the inheritance.
When preparing a will, Hayden recommends referencing an addendum
in the will where you list who will get your various assets and personal property
(and be sure to include your pets). That way, should you make changes, you won't
incur a legal fee to do so.
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https://www.legalwills.ca/fr/.
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