Estate Planning for the Single Parent
Raising children is difficult these days. Was it ever easy? However, it is even more challenging if you are a single parent. Not only are your kids dependent on you during your life, but you must also plan for someone to care for them if you die or are incapacitated due to a significant illness or injury.
It is a common situation. In the United States, 23% of children under 18 live in single-parent households. If you are not around, who will care for your children? Having the right legal documents is critically important for single parents to protect their loved ones.
What Estate Planning Documents Do I Need as a Single Parent?
Estate planning covers situations where you are unable to manage your financial affairs or make health care decisions while you are living and covers your estate administration when you die. There are four documents you need for a comprehensive estate plan.
There are situations where a revocable or living trust is appropriate. You may want to consult an estate planning attorney for specific legal advice if you have a blended family, a child with special needs, or a high net worth.
What Do I Put in My Financial Power of Attorney?
In a financial power of attorney document, you name someone to handle your financial affairs. They will have access to your bank accounts and pay your bills and taxes. They will also manage the financial support of your children by paying for education expenses and day-to-day living. You specify what powers you want to give your “agent.”
You should not only name an agent but also name a backup agent if your first choice is unable or unwilling to serve.
What Do I Put in My Health Care Directive?
Your health care directives consist of a health care power of attorney and a living will. In the health care power of attorney, you name who you want to act as your agent to make medical decisions for you when you can’t.
In your living will or advance medical directive, you state your wishes for end-of-life treatment and care. You state what measures to take (or not take) to prolong your life, such as feeding tubes, artificial nutrition, and hydration. If you make these decisions now, it saves your family from having to make these tough choices.
What Do I Put in My Will?
A last will and testament is a document where you detail your instructions of how you want things handled when you are gone. In your will, you name:
- A personal representative (also called an executor) to manage your estate, follow the instructions in your will, and distribute your assets to your beneficiaries
- A guardian for your minor children (children under the age of 18 are considered minors)
- Who you want as beneficiaries to inherit the rest of your assets and specific gifts for them, such as cash or personal possessions
In your will, you should also name alternate personal representatives, guardians, and beneficiaries.
However, your will does not handle all of your assets and money. Assets that transfer outside of the will are those with named beneficiaries such as a bank account with a transfer on death (TOD) beneficiary. Similarly, life insurance policies or retirement accounts with beneficiary designations go directly to them. These assets do not go through probate court.
What Does a Guardian Do? Who Should I Choose?
A guardian takes care of your children and provides for their health care, support, education, and well-being.
If your child’s other parent is living, typically your child will go to them. However, if they are not allowed to have custody, you may need to choose someone else. A probate court will do what is in the best interests of the child, so if the surviving parent or named guardian is not suitable, the court will appoint another person or family member.
How To Make a Will
Once you decide on what to put in your will, how do you make one? If you have a simple will, you can look into online estate planning services. For a complicated estate you should consult an estate planning lawyer. Getting started today will give you peace of mind that your children’s future is protected and they are looked after.
Related Resources
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