Estate planning is even more important for individuals and couples without children. Without an estate plan, your assets may go to long-lost relatives you’ve never met. You also need to plan for incapacity, especially if there are no living relatives.
While your legacy may be different if you don’t have children, you still need to have an estate plan.
Motley Fool’s article, “5 Estate-Planning Tips for Child-Free Couples,” suggests that you may want to leave some of your money to friends, family members, charitable organizations, or your college. No matter the beneficiaries you choose, these estate planning tips are vital for childless couples.
- A will. You need a will because couples without children don't have natural heirs to inherit their wealth. If you die without a will, your assets will go to your spouse. If neither of you has a will, the state intestacy laws determine which of your family members inherit from you. The family of the first spouse to die may be disinherited.
- A power of attorney. Who will make financial decisions for you, if you and your spouse become incapacitated? You can select a person to do this with a power of attorney (POA). You can name a person to pay bills, manage your investments and handle property matters, if you're unable to do so yourself.
- Up-to-date beneficiaries. If you have retirement accounts or life insurance policies, the distribution of the proceeds at your death is made by a beneficiary designation, not by your will. A frequent beneficiary error is not keeping those designations current.
- Give money to charity now. You may think about leaving your assets to organizations that have enriched your life. You can set up a trust to be sure that your money goes where you want. Work with an experienced estate planning attorney.
- Remember the pets. If you have furry children, plan for their care when you're not around to tend to them yourself. One option is to name a person to take care of your animal in your will. You can also put money into a trust specifically intended for the animal's care or designate an organization that will provide lifetime care for your pet with money you earmark to that purpose.
Your estate planning attorney can walk you through the steps to ensure that you and your spouse or you have a plan in place that addresses incapacity and death.
Reference: Motley Fool (September 9, 2019) “5 Estate-Planning Tips for Child-Free Couples”