The holidays are approaching, so it is time to put up the decoration, wrap the gifts, and spike the eggnog! Can you believe 2022 is almost over? Are you setting resolutions for the new year? Whether or not resolutions are part of your regular practice, we have a really good goal to add for 2023: Comprehensive Estate Planning.
What is estate planning, you ask?
Estate planning is the process of writing down instructions and nominating trusted individuals who will manage your affairs if you cannot. It plans for two main life events: (1) you are alive but unable to make your own business, legal, financial, or health care decisions; and (2) you pass away.
For a thorough overview of estate planning documents, review these two blogs:
You may be thinking, “Okay, sounds like a great goal. For someone else. But I do not need one.”
Everyone needs an estate plan.
No matter how young and fit you are, health is, unfortunately, unpredictable. As many people learned during the COVID-19 pandemic, in the event of unexpected hospitalization, external factors may prevent you or a loved one from access to each other. Without an estate plan in place, no one can step in and help the hospitalized party with their care.
Neither children nor relatives have permission to make decisions about healthcare, medical equipment, or even daily expenses for another person without power of attorney and/or a healthcare surrogate. Having someone to step in, manage affairs, and plan care for you can help you financially and remove emotional and psychological pressures when you’re focused on getting well.
This is just one of many examples of why you need plans in case of temporary long-term incapacitation. If you do not have a healthcare surrogate and POA yet, we can help.
We’ve put together a list of scenarios below to show how everyone benefits from estate planning, regardless of age, marital status, or income.
Single (Unmarried) Individuals
Many people assume that an estate plan is just for people married with children and grandchildren. This is a mistake. It is especially important for “single” people of any age to designate someone to be their representative in the event of an emergency.
In the eyes of the law, being “single” means having no legal partner. No matter how serious or long your relationship is, a “boyfriend” or “girlfriend” is not legally recognized and has no rights involving your medical care.
In the event that you or your partner pass away and you have no plan in place, the state will decide who gets your assets. An estate plan is essential for protecting those who share a life – a home and more, with their partner but lack a marriage certificate.
Unmarried, With Children
Again, it is essential for “single” people of any age to have estate planning measures in place, especially for individuals with children.
If you are not married, your relationship is not recognized in the eyes of the law, and you are considered “single, regardless of whether you share a child. In fact, your partner is a legal stranger, and medical information cannot be shared with someone unless they are a designated healthcare surrogate, nor financial information without power of attorney.
If something unexpected happens, it could be detrimental to the family if the other parent cannot access the injured party’s information and assets or make decisions on their behalf.
When minors are involved, it is important to allocate assets carefully. It is crucial to make sure your children are provided for. Not having a plan in place could put your child at risk of not having assets easily accessible for their care or requiring a guardianship over property you indeed to be theirs.
It is equally important to plan for guardians. The court can appoint a guardian if parents pass away without a will. They may decide to give guardianship to grandparents or other relatives, which could be against your wishes or cause unnecessary family conflict.
While no one is a better parent for your children than you are, you will feel better knowing you helped choose who will care for your children in the event you are unable to.
Married With or Without Children
A healthcare surrogate or power of attorney is important if you are married, with or without a child, for a number of reasons:
- If you do have children, it is important to ensure they are provided for, for all of the reasons stated in the previous section (See Unmarried, With Children).
- Suppose you have a blended family that includes children from other relationships. In that case, an estate plan will ensure your children receive the proper amount of assets you wish and that the assets are not comingled with step-siblings, half-siblings, etc. In short, a plan ensures your assets go where you want them to.
- Even if you do not have children, married couples must have an estate plan to access assets that are not jointly titled, such as retirement funds, IRA, etc., in the event one partner loses competency.
Without an estate plan in place ahead of time, your only option is to be appointed Guardian over your spouse rather than Power of Attorney. Establishing a Power of Attorney costs a few hundred dollars. At the same time, a Guardianship can cost thousands and requires regular accounting, updates, and extended court involvement for many years to come, possibly an entire lifetime.
- In the event both partners are involved in an accident, having a Power of Attorney or Health Surrogate(s) in place is an extra layer of protection if neither partner can perform these duties for the other.
In conclusion, if you have kids, you need an estate plan. If you do not have kids, you need an estate plan. If you are married, single, or in a “complicated” relationship, you need an estate plan.
As family law and estate planning attorneys, we have seen every scenario listed above and then some. Estate planning is more than drafting a will. If you are ready to plan for your family’s future, contact us to schedule a free consultation by calling 813-498-2757 or visiting https://mccarttesmer.com/contact-us/.