These days, about five out of ten marriages will end in divorce, or about 50 percent. What’s more, the risk of divorce increases with every subsequent marriage. Whether you’re divorced, widowed, or were never married, you’re not alone. Being single is no longer stigmatized like it was decades ago, and we have more singles than ever before.
If you’re single, it doesn’t mean that estate planning doesn’t apply to you. In fact, it’s quite the contrary. If anything, you need it more than married individuals because you don’t have a spouse who will automatically inherit your estate when you die. As a single person, you have unique issues that require advanced estate planning with the guidance of an experienced estate planning attorney.
What Are the Issues That Affect Singles?
Here are the specific issues that apply to single individuals:
A number of your assets may be bound by beneficiary designations, which supersede a will. Such assets include bank accounts, life insurance policies, 401ks, IRAs, and such. With these accounts, you have to designate a beneficiary when you initially enroll.
If for example, you designate your nephew as the beneficiary on your 401k, but he ends up in prison after trafficking drugs and you die, he could receive all of the 401k funds, even if you later drew up a will designating that those funds would go to your favorite charity.
If it’s been more than five years since you designated your beneficiaries, or if you’ve gotten a divorce, you should review all of your beneficiary designations to make sure they reflect your current wishes and do not go to a former spouse if you pass away.
When married people die without a will, which is called “dying intestate,” their assets are usually distributed to their spouse and children. If they don’t have a spouse, then directly to their biological and adopted children. If they don’t have children, they usually go to the closest blood relatives, such as parents and siblings and so on.
If you pass away and you don’t have any surviving relatives, your assets would most likely go to the state instead of to your favorite cause, non-profit organization, charity, or church.
To ensure that your assets don’t end up with a distant relative you don’t know or care for, or with the state, you should consider drafting a will and possibly an irrevocable living trust that clearly states how you want your assets are to be distributed and to whom.
Trusted Decision Makers
If you become disabled due to advanced age, an accident, injury, illness, or disease, you may not have the mental capacity to make health decisions for yourself or manage your finances. Since you are single, it’s important for you to select a trusted friend or family member who can make financial and healthcare decisions on your behalf in case you become incapacitated.
We are only scratching the surface in regards to the estate planning tools available to singles. We recommend contacting our firm to meet with a Rancho Cucamonga estate planning lawyer to make sure your assets are ultimately distributed according to your specific wishes.