When the topic of estate planning is discussed, it’s common to focus on the priorities of protecting the estate to retain value for heirs. Usually, parents pass their estate onto their children. An estate planner can help by minimizing the financial burden when this transition occurs.
When a person doesn’t have a clear idea of who their representatives and beneficiaries should be, estate planning gets a little more complicated. This situation is typical for single adults without children or close family. Just because you don’t have a specific beneficiary in mind doesn’t mean that you should procrastinate estate planning. In fact, estate planning for single people might be more important than estate planning for married couples with children.
Hierarchy for Assets
Through estate planning, you can choose a family member, friend, or even a charitable organization to receive the proceeds from your estate. If you haven’t created a will and there is no specified beneficiary, then a hierarchy is followed to determine who gets the assets.
An heir is a relative, whereas a beneficiary is anyone that you choose as the recipient in your will. Your estate will go to the next surviving heir, following this priority list:
· Children of a spouse who passed away
· Relatives of a spouse who passed away
· Your state of residence
Don’t leave your estate to the determination of your state! Instead, consider leaving your assets to someone you’d like to support. You might name the beneficiary as a romantic partner, a close friend, a family member, or a business partner. It’s up to you to list the person in your will. The most effective way to name a beneficiary is through a legal document created – your last will and testament.
Other Considerations for Estate Planning
In addition to choosing a beneficiary for your estate, you also need to be prepared with a health care representative, listed through a power of attorney document. Additionally, an executor can be named for your last will and testament, which is the person that enforces the decisions listed in your will.
Having a personal representative to support your estate planning is an effective way to ensure that nothing is overlooked. If you’d like to learn more, call our experienced team at Miles & Hatcher, LLP: (909) 481-4080.