You may think that, because you’re single, you don’t need to worry about making an estate plan.
However, this is not the case. Singles are in a unique position when it comes to dividing their assets, making it necessary for them to have a plan in place.
When one married spouse dies, most of the property is typically passed on to the other spouse. Unfortunately, for singles, the process is not so cut and dry.
Because the process is a bit more complicated for singles, it’s never too early to start making plans for your estate. If you’re one of the 105 million single people in this country, keep reading to learn about the top 5 estate planning strategies.
Understand Dying Intestate Laws
According to the American Bar Association, 55 percent of individuals die without a will.
This is also known as “dying intestate.”
This means that, for those who are single and die without a will, their assets first go to their children. If there are no children alive, then next in line would be parents, followed by siblings, and then distant relatives.
Understand also, that the state doesn’t take your personal relationships into account. So, for example, let’s say you’re extremely close with a niece or nephew but not at all close with your siblings.
If your estate is left to the state, your assets will still go to your siblings.
Meet with an Attorney
When it comes to estate planning strategies, there is no better person to help you than an estate planning lawyer, also known as an estate law attorney or probate attorney.
An estate planning lawyer is a licensed professional who will educate you about the probate process, help you create your will, designate your beneficiaries, and help you avoid estate taxes and avoid the probate court process.
These attorneys can help you create an individualized plan for your estate based on your specific needs and offer you the most valuable legal advice for your situation.
Durable Power of Attorney
An attorney can help you bestow the power of an attorney on a trusted individual. This means that if you were to become incapacitated, the trusted person would make decisions regarding your estate on your behalf.
This position also allows them to look after your financial matters should you choose to travel for an extended period of time.
Create a Will
Ideally, whether you choose to meet with a lawyer or not, your estate planning process will begin by creating a will.
Writing a will means your estate assets will be correctly distributed to the chosen beneficiaries. These beneficiaries may be individual persons or, for those without living family, chosen charities or organizations.
You may change your mind about your chosen beneficiaries in the course of your life, so make sure you update your beneficiary designation within your will and trust.
Understand Estate Taxes
Married couples own property jointly, meaning they can leave their property to their spouse without paying estate taxes.
A single person’s property, on the other hand, can be hit with an estate tax if the value of their property exceeds the federal tax exclusion.
Therefore, you may want to consider setting up a trust to reduce or defer this estate tax.
Estate Planning Strategies: Wrap Up
We hope this article helps clear up any questions you had about planning your estate.
Estate planning can be extremely confusing, so we strongly encourage you to meet with a lawyer as soon as possible. Contact us today if you’re ready to get started.