Estate Planning for the Single Person
It is a common misconception that single individuals do not need an estate plan. This harmful myth could not be farther from the truth. Everyone can benefit from a comprehensive estate plan, especially singles without obvious heirs. Below are five of the most important things that singles living in Naples, Florida should remember about estate planning.
1. Identify Your Heirs
It is critical to understand that Florida law determines who will receive your estate if you die without a will. When a member of a married couple dies without an estate plan in Florida, the intestate estate goes to the surviving spouse. If there are children from outside the marriage, one-half of the estate will pass to the children. If a single person with no children dies without an estate plan, the intestate estate passes to the decedent’s parents. If there are no living parents, the estate will pass to your siblings and then other family members (aunts and uncles, cousins, nieces and nephews, etc.).
Often the Florida intestate laws do not reflect the wishes of singles, who may want to leave property to friends or charities over more distant relatives. If you want to have control over your inheritance, you must create an estate plan. Having an estate plan ensures that everything you worked for will be distributed to the people and organizations that mean the most to you.
2. Plan for Incapacity
Singles should prioritize creating documents that plan for incapacities, such as an advanced healthcare directive, designation of healthcare surrogate, HIPPA authorizations, and financial powers of attorney. If an unmarried person becomes incapacitated and does not have these documents, there might not be someone to make decisions whose authority will be readily recognized. Doctors, hospitals, and other institutions are much more likely to recognize the authority of a spouse over a sibling or friend. Your loved ones might be forced to go through a time-consuming and expensive court process to name a guardian. With the right documents naming a person you trust, things will go smoother during a difficult time.
3. Consider Creating a Revocable Living Trust
In addition to a will, a single person should consider adding a revocable trust to their estate plan. Unlike trusts, a will must go through probate. As part of the probate process, the executor must notify everyone who would have been eligible to inherit if there had not been a will. These individuals have the opportunity to challenge the will. Even if a challenge is not successful, litigation can cost the estate money and delay the distribution of property. Trusts, in contrast, avoid probate and are kept private, so the distribution of property is often more streamlined.
Additionally, certain types of trusts carry tax benefits. These benefits are particularly helpful to single individuals whose beneficiaries cannot take advantage of the marital deduction to reduce estate and gift tax. An experienced estate planning attorney can guide you on how to reduce your tax liability as a single person in Naples.
4. Carefully Consider Successor Trustees and Executors
Many married individuals name their spouse as their executor or successor trustee. A spouse can be completely trusted and is often the main beneficiary. Singles with no spouse or adult child should carefully consider who should fill this role. They should communicate this decision with the chosen individual to ensure that they are willing and able to serve.
If there is no friend or family member that can fill this role, singles should consider selecting a trusted advisor, such as an accountant or attorney, to serve as executor or trustee. The trust or estate would incur the cost involved in compensating the professional.
5. Update Beneficiary Designations
In addition to a will and trust, singles should ensure that they have the right beneficiary designations on their life insurance, retirement, and bank accounts. It is important to notify beneficiaries and executors of these decisions and let them know where the documents can be located.
It is especially important to update beneficiary designations if you were previously married. Your ex may still be listed as the beneficiary of some of your accounts, and these designations will override any instructions in your will or trust.
Call A Naples Estate Planning Lawyer
If you have questions about creating an estate plan as a single person, you should contact Nici Law Firm. James R. Nici is an experienced Naples attorney with over 25 years of experience. He is well versed in these issues and can create an estate plan that fits your needs. Contact our office today at (239) 449-6150 or use our web form to set up a free consultation.