There is no question that estate planning is often talked about in terms of planning for married couples and families. However, in many ways, estate planning for a single person is more complex than for a married couple. For many married couples, the spouse is the person they trust to make decisions about the disposal of assets and management of medical and financial decisions if they become incapacitated. Without a spouse, it is even more important that a single person have a complete estate plan to plan for their incapacity and death.
It is important for a single person to have a will or trust so you can name the person or entity you trust to carry out your wishes. The estate plan will also allow you to name your beneficiaries. Your beneficiaries are the individuals or entities that you want to inherit your estate upon your death. Without an estate plan, a person dies intestate which means that the state decides the succession laws. Without a spouse, the state is likely to disburse your estate to any surviving children, parents and siblings.
It is also important to evaluate whether your estate may be subject to estate taxes. Married couples can leave the surviving spouse their joint assets without having to pay estate tax and are able to take advantage of estate tax planning at the death of the first deceased spouse. A single person does not have this option, but they may be able to create separate types of trusts that reduce their taxable estate at death. A single person may also want to explore charitable giving at death in order to reduce their taxable estate and gifting during lifetime. As such, it is important for a single person to explore estate tax issues if they believe they may have a taxable estate at death.
Planning for disability is critical for a single person as well. A single person should have a living will which documents your wishes about end-of-life medical care. This document allows you to choose the level of treatment you receive if you are in a persistent vegetative state, end-stage condition or terminal condition. Along with a living will, a single person should also have a durable medical power of attorney. The medical power of attorney appoints a healthcare agent to make decisions for you at any point if you are not able to make your own.
These are just a few of the documents and issues that a single person should think about when creating their estate plan. If you are single and would like to discuss how to plan for your incapacity and death, please contact us at Sinclair Prosser Gasior for an appointment today.