Many people begin thinking about estate planning when they get married, mostly because there’s suddenly someone else to involve in their financial matters. But if you’re single, it’s just as important to plan your estate, and perhaps even more important. If you don’t legally outline what you want to happen to you in the event of an accident that incapacitates you, the state will make decisions about your care and your assets. If you don’t designate people or organizations you want to bequeath your assets to upon your death, the state will decide that too.
What Happens to Your Stuff When You’re Single and You Die?
When a married person dies, their assets generally go to their spouse, even in the absence of a will. When an unmarried person dies, the chain of inheritance is not as clear-cut. Estate planning is important if you’re unmarried and even more important if you’re unmarried with children, in which case you want to be sure that if you die, your kids will have a legal guardian of your choosing and financial support.
You’ve probably heard horror stories about a state-appointed executor managing an incapacitated person’s financial affairs. The Netflix movie “I Care A Lot,” starring Rosamund Pike, was deeply unsettling because it rang so true. The movie, which British writer/director J Blakeson said was inspired by real-life news stories, features a scammer who uses her court-appointed guardianship to take financial advantage of elderly or incapacitated individuals without legal protection.1 eForms wants to help you through the planning process so that doesn’t happen to you. It doesn’t have to be complicated or time-consuming to plan your estate, especially if you tap into our database of free legal forms, but it can be the difference between bad and much, much worse.
The Four Estate Planning Documents ALL Unmarried People Should Have
Bestselling finance author Suze Orman has warned that not having the following four documents is “the biggest financial mistake you can make.” The first is a document called an advance healthcare directive, which authorizes someone to make decisions related to your care if you can’t communicate or make decisions for yourself. Naming a proxy does not take away your own power to make decisions about your care. You are still legally authorized to override anything your proxy decides, if you are capable of doing this.2
Power of Attorney
The second authorizes someone to attend to your legal and financial affairs if you cannot.3 You can sign either a general power of attorney, which expires if you become incapacitated,4 or a durable power of attorney, which remains in effect if you become incapacitated. It may seem counterintuitive, but it’s arguably more important to appoint someone to manage your affairs if you’re young than it is if you’re in the more advanced stages of life. If something happens to you when you’re young, someone else will have the authority to make a decision for you that could last for decades, rather than a few months or years.
A Will AND a Trust
The third document is a will that ensures your assets go where you want them to go upon your death. The beneficiary of your will, or recipient of the assets it references, should be a trust. A trust gathers your assets into a fund administered by a trustee; generally, while you are alive, this is you. It serves as a kind of legal guarantee that if something happens to you, your assets will be used for your benefit.5 You can appoint a successor trustee to manage the trust on your behalf in case you become mentally unfit to make decisions and need the trust to fund your care, for example.6 You can also choose people or organizations to become beneficiaries of the trust upon your death.
If you take care of planning your estate, the worst-case scenario is that you have to spend some hours doing it. If you don’t, the worst-case scenario is that you lose all measure of control over what happens to you and your assets should tragedy or old age befall you. If you’re single, eForms can help you protect yourself during your life, and honor your wishes after your death. Click the link below to access our estate planning forms so you can start designing your future. You can access all of these documents, for free, in our database, which is the largest on the internet. Remember also to revisit your estate planning documents periodically, so you can be sure what you wanted is still what you want in every stage of life.