Many people, in fact it might be fair to say most people, put off estate planning far longer than they should. When speaking with individuals who do not have an estate plan, one of the most common excuses we hear is: “I’m single.” In fact, being single is right up there with “not having many assets” and “having plenty of time for that later” when it comes to the reasons why people choose not to make the effort to put a plan in place.
However, in the vast majority of cases, each of these lines of reasoning turns out to be misguided. For example, being single can actually be even more of a reason to make sure that you have planned for what is inevitably to come.
Why You Need an Estate Plan Even if You Are Not Married
If you are single, there are a number of reasons why you need to have an estate plan in place. To begin, we need to talk about a complex – and at this point somewhat archaic – legal principle: The doctrine of intestate succession. But, before you nod off, just know that we promise to keep this short, and it will help you understand the key reasons why you need to have an estate plan in place.
Understanding the Basics of “Intestate Succession”
Intestate succession is the law in the United States and various countries around the world that governs what happens when a person dies without an estate plan in place. If you die without an estate plan, there is a complex statutory hierarchy that determines which of your family members will be entitled to a portion of your estate after your death. If you are married, intestate succession laws generally provide that your spouse will receive the majority (if not all) of your assets, but if you are single, things can quickly get much more complicated. In addition, even where intestate succession laws determine who is entitled to a share of your estate, they do not prescribe which assets should go to which individuals.
Further complicating matters, each country (and, in the US, each state) has its own intestate succession laws, and they are by no means consistent across borders. As a result, if you moved overseas, immigrated to the United States, or have property in multiple states across the US, failing to leave behind an estate plan can create a legal quagmire for your loved ones after your death.
Avoiding Intestate Succession with an Estate Plan
Furthermore, not only does relying on intestate succession leave behind a mess (which will need to be sorted out through the costly process known as “probate”), but rarely does it actually serve anyone’s final wishes. So, to summarize, three of the key benefits of having an estate plan if you are single are:
- You Decide Who Gets What. By preparing an estate plan, you get to decide how your estate will be distributed instead of leaving it to some lawmakers who put together the intestate succession hierarchy decades ago.
- You Spare Your Loved Ones the Challenges of Dealing with Intestate Succession. Dealing with intestate succession often leads to emotionally charged disputes that can tear families apart. Putting together an estate plan will spare your loved ones the challenge of trying to make decisions that you could have much more easily made on your own.
- You Avoid the Costs of Probate. All unplanned estates go through the probate process. Probate is time-consuming and can be very expensive. It can also be avoided with even a fairly basic estate plan.
What Singles Need to Know About Estate Planning
So, now that you know why you need an estate plan if you are single (although, as you’ll see below, we’ve really only scratched the surface of the benefits of thorough estate planning), what do you need to know about the estate planning process?
1. A Stand-Alone Will Isn’t Your Best (or Only) Option
For most people, when they think about estate planning, they think about a will. However, while wills have traditionally been the go-to tools for estate planning, there are a number of reasons to consider other options as well.
For one, and perhaps most importantly, wills are still subject to the probate process. As a result, while a simple will is an important fallback or “catchall” document in case you acquire assets that are not covered by the rest of your estate plan, in most cases you will want to prepare a plan that focuses on probate avoidance.
2. There Are a Variety of Estate Planning Tools Available
The good news is that, in the United States and abroad, there are a number of non-probate estate planning options available. These days, one of the most popular options in the US is what is known as the revocable living trust. However, each country has its own unique planning tools, and it may be necessary to use a number of different tools in combination in order to develop a plan that fully achieves your goals.
3. You Probably Have More Assets Than You Realize
This is another one of the common misconceptions we noted above. When it comes to planning your estate, there is a good chance that you have more assets than you realize. One of the earliest stages of the estate planning process will involve developing an inventory of everything you own, from bank accounts to safe deposit boxes to intangible property, to make sure that your estate plan is 100 percent comprehensive.
4. It Matters Where You Live, Have Lived, and Will Live
Estate planning laws vary from one jurisdiction to the next, and knowing which laws apply to which of your assets will be critical to developing a comprehensive and enforceable estate plan. Taking into account your future plans can help ensure that the assets you acquire over time will fall within the scope of your estate plan as well.
5. Estate Planning Can (and Should) Be Part of a Larger Asset Protection Strategy
For many individuals, building their estate plan will go hand-in-hand with an overall asset protection strategy. Certain asset protection tools, such as asset protection trusts, have restrictions that may not necessarily align with the goals of estate planning (and vice versa), so it is important to take a holistic approach to protecting your assets and planning for what is to come.
6. There is More to Estate Planning Than Deciding Who Gets What
So far, we’ve been talking about the asset distribution side of estate planning, but it is important to note that estate planning has a number of other facets as well. Healthcare planning is a huge part of the process; and, if you have children or pets, providing for their care will obviously be critical as well.
7. Estate Planning Is Not a One-Time Process
Finally, estate planning is not a one-time process. If you are waiting until the “right time” to plan your estate, that time is now. Your estate plan can – and should – provide flexibility so that you can make changes over time, and you do not want to put off your planning until it is too late. At Jiah Kim & Associates, we develop lifelong relationships with our clients, and we offer free estate plan updates for our clients every three years to make sure that their plans continue to serve their goals.
Schedule an Estate Planning Session at Jiah Kim & Associates
If you are single and have questions about estate planning, contact Jiah Kim & Associates today to get started with an initial consultation. We represent clients worldwide and would be happy to take the time to discuss your needs. To speak with an attorney, call us at (646) 389-5065 or schedule an appointment online today.
This blog post is written for educational and general information purposes only, and does not constitute specific legal advice. You understand that there is no attorney-client relationship between you and the blog publisher. This blog should not be used as a substitute for competent legal advice from a licensed professional attorney in your state.