Everyone knows that once you have kids, you have to start planning for the future. However, few Californians realize that there are many advantages to starting the estate planning process far before you have children. This article explains when you might want to work on your estate plan as a single adult with no kids and why:
- The benefits for singles of planning their estates early, and what documents you’ll want.
- Who, outside of immediate family, you can bequeath wealth or assets to.
- Knowing how to choose the right trustee and when to update your California estate plan.
What Are The Benefits Of Estate Planning If You Are Single With No Children? What Are The Costs For Failing To Do So?
A lot of people think that since they do not have children or a spouse, they do not really need to worry about estate planning. In reality, there are actually extra benefits to planning your estate as a single person, just as there are disadvantages in failing to do so.
Avoiding The Default Estate Plan
If you don’t create an estate plan, the law will make decisions for you, which might not reflect your personal wishes.
For married individuals with children, the law usually distributes assets to the spouse and kids in a way that feels natural. But for single individuals, the law might prioritize parents or siblings, even if your closest relationships are with non-relatives or nieces and nephews who might not inherit anything without proper planning.
Estate planning lets you decide who will benefit from your estate, ensuring that your assets go to the people who matter most to you.
Maintaining Control Over Healthcare And Finances
In addition to naming your beneficiaries and expressing your wishes, estate planning allows you to designate agents for healthcare and asset management. These trusted individuals can make decisions or take actions on your behalf if you become incapacitated.
Without a power of attorney, if you are incapacitated, a loved one would need to go to court to obtain a conservatorship to make healthcare or financial decisions for you. This process can lead to disagreements over who knows you best or what is best for you.
Couples generally don’t face this issue because, by default, their spouse can make these decisions. However, if you are single, the default might be a close family member. But what if the person you truly trust to make your healthcare or financial decisions is your best friend?
Perhaps you want someone in your community who is financially savvy to manage your assets, rather than an estranged family member who isn’t wise with money. Estate planning ensures that your preferences are respected and that the right people are in place to act on your behalf.
Attorney Rebecca Sommer is an experienced California estate planning lawyer based in Anaheim who has helped everyone, from young adults going off to college to retiring elders, prepare their estate plans.
With a background in financial planning, her advice is especially important for those who wish to avoid the costs of probate and keep their estates from being drained by taxes.
Have you started planning your estate? Do you have all the estate planning documents finalized and updated? Contact The Law Office of Rebecca Sommer today to begin.
Call For A Free Assessment Of Your Needs - (657) 571-1241
What Estate Planning Documents Are Crucial For Single Folks Without Children?
Everyone over the age of 18 needs a durable power of attorney and an advanced healthcare directive. If something happens to you, these documents ensure that someone you trust can handle your finances and make healthcare decisions on your behalf. The advanced healthcare directive tells doctors who can make decisions for you and outlines your preferences for those decisions.
Depending on your assets, you may also need a trust. Without a trust, your assets will go through probate, which can be expensive and time-consuming, potentially depleting your estate. A trust allows your assets to pass directly to your chosen beneficiaries without the need for probate.
A trust also provides significant benefits in case of incapacitation or death. It enables you to give detailed instructions for the distribution of your assets, ensuring that your wishes are followed and your loved ones are taken care of.
How Can I Leave Assets To Someone Outside Of My Immediate Family?
Without estate planning, your immediate family will receive whatever is left of your estate after probate. However, with estate planning, you can avoid probate and designate your assets to anyone you choose. You can leave your wealth, property, and assets to:
- Your friends
- A current partner
- Neighbors
- Fur babies (if you have animals or pets that are important to you, your estate plan can provide for their care)
- Organizations such as churches, schools, or charitable organizations
- Any cause or institution you are passionate about
You have numerous options when you engage in advanced estate planning. You can choose anyone or any combination of recipients, and you don’t have to limit your choices to individuals. These decisions can be incredibly meaningful, allowing you to have a significant impact on the lives of those you care about and the causes you support.
How Do I Choose The Right Trustee For My Estate?
Choosing the executor of your will, or even more importantly, the trustee in charge of managing your trust, is a delicate and crucial decision. You need someone you trust, but they don’t have to be a relative.
If you have a close friend or even a neighbor you believe would be a good trustee, they can serve in this role. You can even provide compensation for their efforts, making it a way to help them out or cover their time. If you’re considering a friend but worry about inconveniencing them, offering compensation can ease your mind.
Trust isn’t the only factor; the person’s personality and behavior are also important. Ideally, you want someone who is organized and good with paperwork. It’s beneficial to choose someone who can effectively manage agents, such as hiring someone for tax returns or consulting with a realtor for the sale of a house.
Additionally, it helps if the person you choose is located nearby. They don’t need to be extremely close, but having them in the same state, if possible, is advantageous.
What If I Do Not Know Or Trust Anyone Appropriate To Be A Trustee?
If you are single and don’t have anyone who fits the bill to be a good trustee, consider hiring a professional fiduciary. Professional fiduciaries are compensated for their work and bring additional skills and experience that make them well-suited to the task.
In California, professional fiduciaries must meet screening requirements, adding a layer of trust and reliability. Additionally, they are required to post a bond with the state, ensuring compensation is available if a professional fiduciary proves to be irresponsible or unethical.
Hiring a professional fiduciary can provide peace of mind, knowing that your estate will be managed competently and responsibly.
Attorney Rebecca Sommer is an experienced California estate planning lawyer based in Anaheim who has helped everyone, from young adults going off to college to retiring elders, prepare their estate plans.
With a background in financial planning, her advice is especially important for those who wish to avoid the costs of probate and keep their estates from being drained by taxes.
Have you started planning your estate? Do you have all the estate planning documents finalized and updated? Contact The Law Office of Rebecca Sommer today to begin.
Call For A Free Assessment Of Your Needs - (657) 571-1241
When Should Singles In California Review And Update Their Estate Plan?
Estate plans are exceptional tools, but they will not evolve naturally with your wishes, preferences, and situation. To ensure the estate plan is up to date and reflects your genuine wishes, it is preferable to review it regularly or when your circumstances change.
How Often Should I Review And Update My Estate Plan?
It’s generally wise to review your estate plan at least every two to three years. You don’t need to conduct an extensive review with an estate planning lawyer or gather every family member to go through it page by page.
However, you should at least check who you plan to give responsibilities and assets to and make sure it still aligns with your current wishes. If you never review it, you might find that it doesn’t meet your needs when the time comes.
What Significant Events Or Changes In Circumstances Warrant An Estate Plan Review?
You should also revisit your estate plan if you experience significant changes in your family or finances. For instance, if you have a falling out with a family member or friend, you might no longer want them to be a trustee or beneficiary of your assets.
Additionally, if your financial situation changes significantly, such as receiving a large windfall, you may need to reassess the tax planning aspect of your estate plan. Even if no tax optimization is needed, you might want to redistribute your assets.
For example, if an organization was set to receive a $50,000 donation from your estate and now stands to receive a much larger sum, you might want to include additional beneficiaries to share the wealth.
What Can Prompt An Estate Plan Update?
You’ll also want to update your estate plan whenever your goals change or when there is a significant change in your family or finances. In particular, any financial changes should be reviewed by a professional to assess any potential impact on taxes or logistics. Consulting with an attorney when your goals shift or when any significant change occurs can save you a lot in the long run.
How Easy Is It To Overhaul My Estate Plan If I Get Married Or Have A Child?
It is both possible and encouraged to update your estate plan if you get married or have a child. These are significant moments when you should consider an update.
If you fail to update your estate plan, the law might step in and “fix” your mistake in a way that you did not intend, such as through the omitted spouse statute or omitted child statute. You may have wanted your estate plan to stay the same, but the law could change it, or you may have intended for changes that the law does not implement as you thought it would.
People often worry that reviewing and updating their estate plan will be extremely expensive or that they will have to start over from scratch. This concern can prevent them from creating a plan or updating it when needed. Fortunately, neither is true.
Once you have a revocable trust in place, a simple amendment is usually enough to make most modifications. Additionally, if you are married, there are tax advantages to planning together and creating a joint trust. While you might consider starting from scratch, the benefits can make it well worth the time and effort.
For more information on Estate Planning Tips For Singles Living In California, an initial consultation is your next best step. Get the information and legal answers you are seeking by calling (657) 571-1241 today.
Attorney Rebecca Sommer is an experienced California estate planning lawyer based in Anaheim who has helped everyone, from young adults going off to college to retiring elders, prepare their estate plans.
With a background in financial planning, her advice is especially important for those who wish to avoid the costs of probate and keep their estates from being drained by taxes.
Have you started planning your estate? Do you have all the estate planning documents finalized and updated? Contact The Law Office of Rebecca Sommer today to begin.
Call For A Free Assessment Of Your Needs - (657) 571-1241
