Planning ahead for your family when you don’t have children is a little bit different than when there are children involved. When you don’t have to worry about paying college tuition and other financial obligations parents often have to think about, you can consider different techniques that may not have been financially feasible if you had children.
Whether you have kids or not, creating an estate plan is important. A comprehensive estate plan will assign people to make decisions if you are unable and states who should inherit your property after you and your partner pass away. You can also plan to minimize taxes and ensure that your wishes are followed if your health declines.
Appoint people to make financial decisions. Anyone, including couples without children can create a power of attorney that names their partner to make financial decisions on their behalf if they are unable. Each of you can also name alternate decision makers if neither of you are able to make decisions about your assets and property. You can also name a personal representative or successor trustee to administer your estate after death. When there are not adult children to name, you should consider a family member or friend that you trust to make the best possible decisions.
Make critical health care decisions. As part of a comprehensive estate plan, you can make health care decisions today that may come in to play later in life. By creating health care directives, you can name a person to make health care decisions if you are unable (most likely your partner with one or two alternates) with a health care power of attorney, allow someone to access your protected medical records in an emergency situation with a HIPAA authorization, and make end of life decisions with a living will.
Create a distribution plan for assets. An experienced estate planning attorney can help you craft a distribution plan for your assets and specifies who should inherit your assets. With a last will and testament, you will name one or more persons or charities to inherit you assets. With a will, those assets will pass outright after you pass. A probate will likely be necessary to effectuate the transfer of the assets. With a revocable living trust, you will similarly name what persons or charities should inherit you property, but you also have the benefit of naming when they should inherit. Also, a properly funded trust may avoid probate. When a couple doesn’t have children, determining who should inherit their assets requires a little more thought. We often see siblings, parents, nieces and nephews and best friends named. This is also a great opportunity to give to charity.
Your estate plan can also include strategies to minimize estate taxes, and giving financial gifts before and after you pass. Under current tax law, any individual can gift up to $14,000 per year per person to as many people as he or she wishes without gift tax consequences.
Give to charity. When you create your estate plan, you can leave your assets to anyone you want – including charities. Many people like to give to their churches or other causes they are passionate about. When a couple doesn’t have children, this often frees up some assets to leave to charity.
Plan for the unexpected. Any comprehensive estate plan should include life insurance to cover unexpected events. Consult with your financial advisor before and after creating your estate plan to ensure that your assets are titled properly and will function they way you intend.
Every couple – whether or not they have children – should plan for tomorrow today. Get started now by calling Arizona estate planning attorney Abigail Neal today at (480) 699-7992.
