Some people assume estate planning refers to passing on wealth from generation to generation. In estate planning, parents secure their legacy and help their children’s future; however, securing one’s legacy applies equally to those without kids. Mark Fishbein of ALTA Estate illustrates below how estate plans are indispensable, regardless of your parental status.
Why Do Child-Free Couples Need an Estate Plan?
One misunderstanding is that only couples with children need estate planning. However, anyone with assets who wants to decide how to distribute them after death needs estate planning. This fact highlights the importance of estate planning documents specifying these requests. Couples without children can ensure the distribution of their assets according to their desires through a strategic estate plan. The distribution can go to other family members, friends, or charitable organizations. This aspect is critical in estate planning. Estate Plans also cover decisions about your care if you become incapacitated, providing peace of mind for you and your surviving spouse.
- Choosing the Right Agent
An Agent manages your estate after your death, potentially acting on your behalf as detailed in a durable power of attorney. Childless couples should consider a trusted friend, relative, or even a professional agent as part of their estate plan. The Agent should be responsible, trustworthy, and, ideally, have some knowledge of financial or legal matters, acting under a durable power of attorney to manage affairs when you can’t act on your behalf. Another option is appointing a professional agent, which can be a sensible choice for complex estates or when a neutral third party is preferred, a practice often recommended in estate planning tips.
- Designating Powers of Attorney (POA)
A POA allows someone to decide on your behalf if you or your spouse become incapacitated. This legal document outlines how to handle your finances and make healthcare decisions. Childless individuals should carefully select someone they trust implicitly for their POA. In addition to financial and healthcare powers of attorney, individuals may consider naming someone to make decisions regarding their personal care and living arrangements if they can no longer do so themselves.
Discuss your powers of attorney with the selected individuals to prepare them for their responsibilities and ensure they are prepared to step in. Open communication is a must to prevent confusion or conflicts and effectively implement your wishes.
- Creating a Beneficiary Strategy
Without direct heirs, deciding who will inherit your assets requires thoughtful consideration. Options for beneficiaries can include family members, friends, or even employees who have significantly impacted your life. Regularly reviewing and updating your beneficiary designations ensures your estate plan reflects your current wishes. If you don’t have any close relatives or children to whom you can leave your assets, consider leaving them to close friends who have been like family to you or to charitable organizations that are meaningful to you. Life circumstances can change, and regular reviews ensure your estate plan, including directives and living trusts, reflects these changes.
- Incorporating Charities in Your Estate Plan
Charitable giving can be a meaningful way to leave a legacy. Many child-free individuals support causes close to their hearts through their estate plans, aiding the charity and providing tax benefits for the estate. You can incorporate charities into your estate plan in several ways, including specifying how you want these charitable contributions made in your living trust. One standard option is to leave a specific dollar amount or percentage of your estate to a charity in your will or trust. You can also name a charity as a life insurance policy beneficiary or retirement account beneficiary to ensure your estate plan reflects your wishes.
Another way to support a charity is to set up a charitable trust. A charitable remainder trust allows you to receive income from the trust while alive, with the remainder going to the charity upon your death.
A charitable lead trust, in contrast, generates income for the charity for a specified period before distributing the trust assets to your heirs.
- Considerations for Pets and Dependents
Many couples without children consider pets as part of the family and should include them in their estate plans. Likewise, individuals should consider any dependents, such as elderly parents or disabled siblings, ensuring that no one will pass away without addressing their needs. When considering pets in your estate planning, consult an experienced estate planner to ensure necessary provisions are included in your will or trust. Consulting will help avoid potential legal issues and ensure your loved ones are cared for according to your wishes.
Choose An Experienced Estate Planner
Mark Fishbein understands the challenges that come with estate planning for those without children. He and his team at ALTA Estate create tailored estate plans that respect your wishes and secure your legacy. Contact ALTA Estate today to get started.
The text above is for general informational purposes and should not be considered legal advice. For more information, click Contact Us. Follow Mark Fishbein Tucson Estate Planner, on LinkedIn or Facebook. Estate Planners Tucson and Tucson Trust Lawyers.