Do you need an estate plan as a single parent?

Estate planning is something that should be a priority for everyone, not just for wealthy families or those with large families. A well thought out estate plan is also crucial for single individuals, especially single parents. The plan helps protect both the parent and their children’s future by preventing family disputes, and unnecessary financial burdens and stress, during an already challenging and emotional time.

Estate planning for single parents should address:

Guardianship for Dependents

Single parents or individuals responsible for underage children should prioritize estate planning in order to appoint a guardian for their children or dependents. A guardianship designation in a will or separate document ensures that their loved ones will be cared for by someone they trust in the event of their passing. Without proper planning, the court may have to decide who cares for their children, which often may not be the person a parent would choose. 

Asset Distribution

Estate planning allows a single parent to determine how their assets will be distributed after their passing, ensuring that their children are provided for financially and according to their wishes. Without an estate plan, state laws may dictate how your assets are distributed and who makes decisions on your behalf. By creating a will and trust, individuals can decide who inherits their assets and who they want to manage their affairs.

Protection of Assets

Proper estate planning addresses not only the distribution of assets after one’s passing but also involves protecting assets during one’s lifetime. Single individuals and parents need to ensure that their assets are managed and protected in the event of incapacity. This includes naming a trusted person to make financial decisions on their behalf (with a power of attorney).

Health Care Decisions

Health care proxies are necessary for a comprehensive estate plan, especially for single individuals. A health care proxy allows an individual to name a trusted person who they would want to make medical decisions on their behalf in the event of incapacity and may also specify medical treatment preferences.

Avoiding Probate

A trust-based estate plan can help avoid or minimize the lengthy and costly probate process. A revocable trust allows assets to be transferred to beneficiaries more efficiently. This reduces the cost and delays on loved ones.

Beneficiary Designations

Single parents often have retirement accounts, life insurance policies, and other assets with designated beneficiaries. Failure to update these beneficiaries can lead to unintended consequences, such as assets passing to a former spouse or estranged family members. As part of the estate planning process, individuals should review and update beneficiary designations to reflect their current wishes. Our Asset Trust Organizer identifies all of your beneficiaries in one place, which helps you quickly determine if a change is needed. 

By taking the time to create a comprehensive estate plan, single individuals can protect their assets, maintain control over their decision-making, and provide for their loved ones in the way they desire. Whether you have a large estate or modest assets, estate planning for single parents is a responsible and essential aspect of your financial planning.

I speak from experience – as both an estate planning attorney and as a single parent. If you’d like to learn how I navigated this life change, read my personal story of how my estate plan gave me peace of mind when I lost my young husband. And if you have any questions, please don’t hesitate to reach out.