Another day, another estate planning myth to talk about! Here’s one that I hear quite a lot:
“I am single and child-free, so I don’t need estate planning.”
Having this belief is totally understandable. When the topic of estate planning is brought up, regardless of the setting, it is always attributed to families or married couples looking to build families. Single, childless people are thus given the impression that estate planning is not for them.
Let me tell you straight up that this impression is absolutely false! Estate planning for single and child-free individuals is just as important, if not more. In fact, if you have been following my blogs for quite some time now, you might recall one post that makes a similar point: Single? Why You Still Need a Plan.
This time, let me explain why those without children are also very much encouraged to build their own estate plan, and why estate planning is likewise for single, child-free individuals!
Single, child-free people, like pretty much anyone, have accumulated assets.
And for single and childless individuals in particular, their list of compulsory beneficiaries is shorter and limited, unlike those with spouses and children. For these people, the case is usually that there is a lot to give but not a lot to give to!
An estate plan for single, child-free people allows for more leeway, in that they are free to leave their properties to persons who they feel are deserving of such charity. College fund for your nephew or niece? Financial assistance to a friend who is struggling to raise her kids on her own? Sounds like a plan!
Speaking of charity, you may even opt to (as some who are similarly situated have done) give to chosen charities and organizations, especially those who have no living relatives around. Imagine getting to leave some of your hard-earned money to the college or university that shaped you, or shelters and orphanages within your area!
Single, child-free people will most likely have unsettled business, too.
And through an estate plan, these unfinished matters will be left in the hands of trusted, reliable people. Like what I always say (am I starting to sound like a broken record?), an estate plan is more than just a tool to distribute one’s assets after passing. It’s not just a will, folks!
An estate plan can include what we call a power of attorney, which is basically an instrument authorizing another person to act or decide for you. This is most beneficial for single, child-free people, so that they get to be in control even if, technically, they physically are no longer able to. No second-guessing for your parents, siblings, or relatives on matters relating to your properties and other personal affairs, including medical decisions. With an estate plan armed with a power of attorney, you can set who gets to do which and how all of these ought to be done. Read more about what a power of attorney can do here!
Basically, unlike those folks with children where it is more or less instinctive who will handle their matters for them, single child-free people get to use an estate plan to communicate what their preference is and who their trusted people are.
Single, child-free people will most likely also have unpaid taxes.
Yes, an estate plan can solve tax matters, too! Particularly, through an estate plan, you can select a trusty person to be responsible for your tax concerns, as well as reduce the payment of hefty estate taxes. Yup, you read that right—an estate plan can work to lessen the tax your estate is going to be subject to! By distributing your assets as early as now, and by including other estate planning tools such as a trust, estate taxes can be minimized. Pretty awesome, huh?
I can go on, but these top three reasons why single, child-free people need an estate plan will have to do for now. If you still need a little more convincing, though, I am most definitely available for a chat!
Talk to you again on our next myth busting session!