Many people believe that if they are single, they don’t need a will and other estate planning documents. However, estate planning is just as important for single people as it is for couples and families.
Perhaps more so:
If you do not have a will directing who will inherit your assets, your estate will be distributed according to state law. If you are single, most states provide that your estate will go to your children or to other living relatives if you don’t have children. If you have absolutely no living relatives, then your estate will go to the state. You may not want to leave your entire estate to relatives — you may have close friends or charities that you feel should get something. Without a will, you have no way of directing where your property goes.
Likewise, it is important to have a durable power of attorney (for financial decisions) and a healthcare power of attorney (for medical decisions) to allow the people you choose to step in and represent you should you ever become incapacitated.
Unlike married individuals, unmarried partners or friends usually can’t make decisions for each other without signed authorization, meaning no one can represent you unless a court appoints a guardian. The court process is time-consuming, public, and costly. Furthermore, the judge may not choose the person you would prefer.
In short, as a single person, estate planning allows you to ensure that your property will go to the people you want, in the way you want, and when you want. Estate planning can also help you save on estate taxes and/or court costs for your loved ones.
If you’re single and you don’t have these basic documents in place, you should consult with an experienced estate planning attorney. (S)he may also recommend more advanced estate planning documents such as a revocable living trust and a living will to ensure that you are completely protected.