If you’re single, estate planning might not be at the top of your priority list. You may assume, based on how most professionals talk about the process, that estate planning is mainly for couples with kids.
But the truth is, everyone should have an estate plan in place.
Even if you’re not deeply concerned about what will happen to your belongings when you are gone, there are many other reasons to have an estate plan.
- An estate plan includes many other documents that quickly become crucial if you become incapacitated. For example, setting up a power of attorney (POA) and a healthcare proxy (or an advance medical directive or living will) are truly important steps to protecting not only your material wealth, but also your well being. Without these documents in place—and the people you have identified to take on these responsibilities—an unexpected health situation like a stroke or the onset of dementia could leave you in a very precarious position.
- A solid estate plan ensures that your wishes are respected and followed, even when you are not in a position to say what those wishes are. Legal documents like a POA and health care proxy allow you to designate people you trust to make decisions on your behalf, manage your affairs, and advocate for you if you are unable to do so for yourself. Without these documents in place, the court will have the responsibility of assigning someone of their choosing to make decisions about your finances and health care.
- Taking the time to work with a professional to set up an estate plan can also help you avoid common missteps. For instance, if you are divorced, you need to be very careful about updating beneficiary designations on things like insurance policies, bank accounts, and retirement accounts (IRAs, 401(k) plans, etc.). If those designations are not kept current, assets could go to your ex-spouse, which is rarely the intention.
- Coming up with a contingency plan to cover long-term care is another key area that is of particular concern for single people who may not have close contacts who will be willing to provide assistance with navigating, negotiating, and otherwise coordinating long-term care solutions.
There are many other details to consider when preparing an estate plan for a single individual. From how to handle estate taxes and make charitable gifts to the best ways to avoid probate, single people have a lot to gain by taking the time to prepare a detailed estate plan. At the very least, putting a plan in place will help you sleep better at night.
If you’d like to learn more about your estate planning options, we’d love to hear from you. Reach out to us any time at 860-236-7673, or drop us a note via our website.
Why an 18 Year Old Needs an Estate Plan
Estate Planning: Why It’s Not Just About the Money
Who Gets What? The One Thing You Should Add to Your Estate Plan
Estate Plan Updates: Why They Matter and When to Make Them
Webinar: A Single Person’s Guide to Planning for Long-Term Care and Medicaid