Estate Planning for Single Parents
Summary: Planning for unforeseen circumstances is important, especially when someone is a single parent. Georgia estate planning and probate law firm Siedentopf Law addresses several specific estate planning issues, including guardianship, finances, and providing for your child’s basic needs.
The responsibilities associated with being a parent can be extremely challenging. This is especially true for single parents, who shoulder even more of the day-to-day activities and obligations. Concerning estate planning, being a single mother or a single father does present its own set of unique issues. For example, who will take care of the children if the parent is no longer able to? Who will finance the children’s housing, food, and other necessities? Planning for unforeseen circumstances becomes even more important when there is only one parent involved.
Last Will and Testament
A will is a legal document in which a person provides instructions for the distribution of his or her assets, upon death. It ensures that your property goes to the individuals that you want, how you want, and when. For a single parent, it is a good idea to have a will in place, to make sure that your children are adequately provided for. Alternatively, without a will, the state decides how a parent’s estate will be distributed.
Guardian
When a parent dies or is incapacitated, the child’s other biological parent is typically first in line for custody. However, if both parents are unavailable, this becomes a separate issue. In addition to the distribution of assets, a single parent may use a will to name a guardian for his or her child. A guardian is an individual selected to care for a person’s child or children, in the event that the parent dies. If a parent passes away without a will and a named guardian in place, the court will select a guardian itself – and that person may or may not be the parent’s ideal choice to care for their child.
Advance Directive for Health Care
This is a form in which a person lists his or her medical preferences in detail (ex: treatment, medical testing, care options). It gives a selected individual the authority to make medical decisions on your behalf, when you are not capable of doing so yourself. If a single parent has younger children, having an advance directive in place will ensure that the parent is being treated according to his or her wishes and in consideration of his or her children.
Power of Attorney for Financial Affairs
As single parents generally have one-income households, it typically follows that the same parent is the only person signing the bank documents and paying the bills. What happens if that parent falls ill or is otherwise incapacitated? If the parent has a financial power of attorney in place, a trusted individual can take over the financial affairs and make sure the mortgage and utilities are still being paid. A person named as power of attorney can also ensure that the parent’s child or children are being cared for financially.
Insurance Policies
In addition to the basic estate planning documents (will, advance directive, power of attorney), a single parent might also consider purchasing life insurance or disability insurance. The different levels of pricing and coverage depend on your family situation and finances. The goal is to make sure the parent’s child or children are taken care of, in case of unforeseen injuries or death.
Beneficiaries
The beneficiary designations on assets such as life insurance or retirement accounts control who the funds will be distributed to. These accounts are not controlled by your will. Single parents want to make sure the beneficiaries are updated and reflect their current wishes; they want to make sure their children are the ultimate beneficiaries of their designations. This can be accomplished by naming the children individually as beneficiaries, naming the estate as a beneficiary or naming a trust as a beneficiary. It is important to discuss the implications of these choices with your attorney because there are tax and other treatment differences, especially for IRAs, that will determine which is the best choice for you. It is a good idea to update your beneficiary designations after major life transitions: divorce, remarriage, or death of a spouse. Also, it is important to note that while children may be listed as beneficiaries, minors cannot legally control assets. A guardian may need to be appointed to manage the child’s assets until they turn 18 years old.
For more information about these and other estate planning options available, visit Siedentopf Law via our website EstateLawAtlanta.com or call us today at (404) 736 – 6066.
© Sarah Siedentopf and Siedentopf Law, 2018. Unauthorized use and/or duplication of this material without express and written permission from this site’s author and/or owner is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to Siedentopf Law and EstateLawAtlanta.com with appropriate and specific direction to the original content.