No kids? 3 reasons you still need an estate plan
True or false: people without kids or significant assets don’t need to worry about estate planning. FALSE! No matter your financial or family situation, if you are over the age of 18, it’s time to start thinking about your estate plan.
Another related myth is that estate planning is all about outlining what will happen to your assets after you pass away. While this is an important part of an estate plan, there are many other factors to consider, like who will make health care decisions for you if you are no longer able to do so yourself. These are major factors that, without an estate plan, are left up to the courts to decide.
An estate plan is not just for the benefit of the next generation; it’s a crucial part of planning for your own future and that of the people and things you hold dear.
No kids? Here are three reasons why you still need an estate plan:
- You should decide what happens to your assets. In creating a last will and testament, you get to outline your wishes for what happens to your assets should you pass away. Even if you’re not wealthy, you likely have things that will need to be distributed (like a car, home, savings account, etc.). If you pass away without a last will and testament, the court will distribute your assets based on state law, making decisions you may not have made yourself.
Deciding who inherits your assets can be a difficult decision, especially if you are not married, don’t have kids, or are estranged from your family. Many times, people without kids leave assets to beloved nieces or nephews, friends, or to a favorite charity.
If you have a pet, a last will and testament also allows you to outline your wishes for who will take care of them should you pass away. You can even set aside money specifically for the care of your pet.
Here is a quick tip to get started today: make a list of your assets (car, home, pets, money in bank accounts, treasured possessions, heirlooms). Then, make a separate list of people or charitable organizations you would like to leave something to. Then, match up the two lists.
- Protect your privacy. If you pass away without a last will and testament (or a trust to house your assets), the courts will take the front seat in making decisions on your behalf. This also means that relatives can get involved and potentially learn things about your personal assets that you’d rather they didn’t.
One great way to manage your assets both during your life and after you pass away is by putting them in a trust. A trust can act as a substitute for a last will and testament, keeping your personal information and assets safe and helping them avoid probate. A trust also allows you to detail who should benefit from your estate, leave gifts to charity, and outline your wishes related to health care and finances.
Having your assets in a trust can also mean they will avoid the often lengthy and complicated probate process after you pass away, meaning your assets can be distributed much more quickly and your personal business is not available to any relative who could possibly inherit. You also will have the opportunity to name a trustee, an individual or financial institution you trust to see that your wishes outlined in the trust are carried out.
- Choose who will make decisions on your behalf. A comprehensive estate plan does not just outline what should happen after you pass away. It also plays a critical role in detailing your wishes for what should happen if you become incapacitated and can no longer make decisions on your own.
As part of your estate plan, you will name the durable powers of attorney for both health care and financial matters. These are the people you trust to make decisions on your behalf should you become incapacitated and unable to do so on your own. In choosing these people yourself (one person can perform both roles, or you can name two different people to these roles), you get to name someone you trust with these critical responsibilities and can prepare them beforehand so they can follow your wishes.
Another critical role in your estate plan is the executor of your will (or, if you have a trust, the trustee). This is a person you name who will be responsible for ensuring all of your wishes as outlined in your will are carried out. In choosing this person yourself, you can ensure this important role goes to someone who is responsible, reliable, and has your best interests in mind.
If you don’t decide who you want to fulfill these important roles, the courts will decide on your behalf.
In all my years as an estate planning attorney, one truth comes back to me time and time again: there is no one-size-fits-all estate plan. Whether you are single with no kids or married with a house full of little ones, laying out your wishes in an estate plan is the best way to protect what’s important to you.
I’m Paul Margerie, an experienced estate planning lawyer serving clients in Brookfield, Waukesha, and across the region. I specialize in helping young people and families protect what’s most important to them through comprehensive, tailored estate planning. Ready to get started? Give me a call today.
