Estate Planning Essentials for Single Parents

When you’re a single parent, there’s a lot riding on your shoulders. This means that planning for the future is incredibly important. While it’s unlikely that you’ll pass away or become incapacitated while your child is a minor, you want to plan for the worst-case scenario and know that your child will be in good hands if anything happens. Whether you already have the start of an estate plan, or you haven’t done any planning in this area, it’s a great time to start.

Get started on your plan for the future now with the help of Haygood, Cleveland, Pierce, Thompson & Short. Call us at 334-821-3892 to schedule a consultation and learn more about your next steps.

Will and Trust

To start with, you need at least a will and maybe a trust. A will is incredibly important for single parents, as it allows them to name a guardian for their child in the event of their death. This is particularly important for single parents that do not co-parent or remarry, as the child may have nowhere to go after their death. After discussing their options with their chosen guardian, you can name them in your will.

A trust is another essential part of an estate plan for some single parents. It allows a named trustee to have immediate access to your assets when you pass away, ensuring that your child is not left without the financial support they need while your estate goes through probate. Establishing a trust also gives you the power to have assets held for your child’s educational expenses, health needs, and other expenses.

Life Insurance

If you don’t yet have a life insurance plan, it may be time to start looking into your options. Single parenting can be expensive, and if you aren’t sure that your estate will cover your burial expenses and the long-term needs of your child, a life insurance plan can fill in the gaps. Discuss different types of plans with your estate planning attorney so you can avoid negative tax consequences and make the money last for your children.

Beneficiary Designations

Depending on the types of assets you have, some of your assets may not go through probate. Some are designed to go straight to named beneficiaries, allowing for immediate access. This includes life insurance, bank accounts, retirement accounts, and pensions. However, if you fail to update your beneficiary designations, these accounts could end up in the wrong hands.

This is particularly true if you want these assets to benefit your child. You’ll need to transfer assets to a trust or a beneficiary you can trust to take care of your children’s needs. Your estate planning attorney can better advise you on how to use these assets to protect your children’s best interests.

Plans for Incapacitation

Estate planning does not just involve planning for your death. It also means thinking about what will happen if you become incapacitated. If you suddenly suffer an incapacitating illness or injury, you want the peace of mind that comes with knowing your children are still being cared for. There are several documents that plan for incapacitation.

A financial power of attorney is a document that names someone to handle your financial matters if you are unable to do so. This is crucial, as it ensures that someone has access to your bank accounts and bill pay accounts. The named person can continue paying your bills, which keeps a roof over your child’s head and allows them to continue their sports and activities.

Another document you’ll need is a health care power of attorney. This gives a named person the right to make health care decisions on your behalf if you are unable to vocalize your wishes. A health care power of attorney is particularly important if you have specific wishes regarding what types of care you will and will not receive.

You can also specify your health care wishes via medical directives and a living will. Through these documents, you can specify what life-sustaining care you want and do not want to receive.

Start Your Estate Plan with Haygood, Cleveland, Pierce, Thompson & Short

No matter where you are in the estate planning process, our team can help you create a plan that meets your needs and protects your child’s best interests. Take the first step now by contacting us online or calling us at 334-821-3892.