“These times, they are a changin’” is the famous line by Bob Dylan. It was an anthem for the 1960’s and early 1970’s. But the more things change, the more they stay the same, as some say.
The number of people who have never been married has steadily grown since 1970. (Pew Research) People are marrying later in life; the divorce rate continues to be high; and many people are not getting married at all.
One 1 in 10 people had never been married in 1970, but by 2012 the number of people who had never been married grew to 1 in 5. Altogether, a total of 62% of Americans in 2011 were single (married, divorced or widowed) (US Census Bureau). More people are single today than ever before.
The importance of estate planning for singles has never been more significant. Estate planning is not just for married couples; estate planning is for singles too. Singles have unique estate planning issues that require specific attention. For instance, the default rules for estate distribution may “work” for married couples, but are not as likely to work well for singles (not that anyone should rely on the default rules at all).
In Illinois, when a spouse dies without a will, the estate passes to the surviving spouse or surviving spouse and children (depending on the age of the children). While that may not be exactly how one would plan an estate, it is a closer approximation of the typical estate plan for married people than the default rules are for singles.
Estate planning for singles is arguably more important than estate planning for couples. With couples, a spouse is the natural, likely and (usually) the chosen person to be the beneficiary of the estate and the person in charge of it. With singles, there is no such person or category of people. Singles have more unique situations and need more uniquely tailored estate planning than married couples.
When a person dies leaving no surviving spouse and no children, the estate will pass along bloodlines (in different ways depending on the state of residence at the time of death). Those bloodlines include parents and siblings in Illinois. Singles tend to be closer to some relatives than others, and they often desire to pass their estates to nieces and nephews rather than siblings or parents.
Many singles have long term relationships and long term commitments, though they have not resulted in marriage vows. Long term relationships that are not formally consummated by marriage or civil union will not be rewarded upon death without an estate plan.
Many single people are involved in social, charitable and community organizations that have taken on significant importance to them. Without an estate plan, their efforts die with them. If something is important enough to warrant the devotion of your attention, time, energy and money during life, it is a candidate for your benevolence on your death. A person might also consider other charitable mechanisms, like naming a charity as the beneficiary of an IRA or 401(k). Through your estate planning you can make your death count for the things that are important to you during your life.
Have you named anyone as beneficiary of your IRA, 401(k), other qualified plans and life insurance? Many people have not, and many more people cannot remember who they have named (or whether anyone is named at all). Life changes as time goes by. Giving attention periodically to your estate planning, including reviewing and updating beneficiary designations, is important.
One of the most important issues for singles with children is providing for those children, especially when they are still minors. Unlike married couples, where a surviving parent/spouse will naturally step in for the children and the estate, singles may not be willing to allow the surviving parent to have access to or control of the estate or even to have custody of the children. While only limited things can be done about custody of the children in those circumstances, the estate should be planned with a friend, relative or other third party taking control instead of the surviving parent.
We are reminded all too often that life can turn on a dime. Sudden illness or injury can change life for you in an instant. Who would you choose to handle your affairs if you suddenly became unable to manage your own affairs or even to make your own decisions? Without powers of attorney in place in which you have chosen who will step in for you, you could end up with people making decisions for you and controlling your affairs that you do not want.
Choosing agents for powers of attorney, an executor for a Will and a trustee for a Trust can be difficult for unmarried individuals. If you do not choose, however, someone will choose for you. Without powers of attorney, you may become a ward of the State if no one steps up to create a guardianship for you. Someone will have to step into the vacuum, so you might as well fill the holes yourself with people of your own choosing.
Estate planning allows you to take ownership of your life, your legacy and the people and causes important to you. Singles have as much need for estate planning as married couples with children, maybe even more. The State default rules are rarely what a single intends. You should control your own legacy. The gap to be filled if a catastrophic injury or illness limits your faculties needs to be filled, and you should be the one who fills it with your own plan.