Many young, unmarried individuals who don’t have children may think they don’t need an estate plan. That is far from the truth. Most people think of an estate plan as deciding who to give your “stuff” to. However, that is not the only purpose of an estate plan. A major component of estate planning is incapacity planning. So when young, single people without kids ask why they need an estate plan, the answer is a question:
“Who is going to take care of you if you can’t take care of yourself?”
The answer to that question is what we are going to build their estate plan around. We are going to empower people to help take care of the young, single person without kids, in case of their disability and/or incapacity.
We are going to create a Living Will so the client can selectively decide which medical procedures they do or don’t want in case of their disability or incapacity.
They are going to appoint a financial power of attorney to help manage their finances.
They are going to appoint a healthcare power of attorney to make medical decisions when they can no longer make them for themselves.
They are going to sign a HIPAA waiver so their healthcare representative can get the personal and otherwise private medical information they need to make an informed decision.
Who is going to take on those roles? Well, the client needs to have some conversations with those close to them; a brother or sister, a cousin, a niece or nephew, maybe a best friend. You never want to put the burden or responsibility on somebody who hasn’t agreed to it or might not be ready for it.
With no spouse or children, intestacy statutes cause unwanted results
Instead of letting the politicians decide, we are going to create an estate plan to use the assets of the client to enable and reward those willing to take on the burden of caring for them in case of their incapacity. The mechanism we use will depend on the client’s financial situation, the interpersonal relationships with their potential caretaker or caretakers, and the level of privacy they do or don’t want.
Since there is no spouse or children to leave the remainder of the assets to, we are going to set up some “welcome bonuses”. In the words of my generation, the client is going to hook some people up. They are going to set up nieces or nephews for success, reward that loyal friend who has always been by their side, maybe provide for the care of a beloved pet.
Just because you are young, single and don’t have kids doesn’t mean that you don’t need to plan for the future.
NOTE: Estate plans are not a “set it and forget It” thing. As major life events occur, estate plans can and should be updated to reflect changes in circumstances.