A common question that I will get from many people here in Tennessee is whether estate planning is even required for single people. I will receive this question from all people in a variety of stages in life, those in their 20s and 30s, and those in their 60s and 70s following the death of a spouse. However, this is one question where I can give a definitive answer to my clients – Yes! Even single people need to have an estate plan in place.
First, we need to discuss probate and what happens to your belongings and your assets when you pass away. When you pass away, and you own property, an estate will need to be opened in the probate court and a judge will need to authorize the distribution of your assets after all costs, creditors, and attorney’s fees have been paid. If you die with a Last Will and Testament in place, commonly called a will, then you are said to have died “testate.” This means that all of your assets will pass to your loved ones according to the specific provisions in your will. However, the unfortunate aspect of probate is that it is a public court proceeding, it is expensive, and it will take a considerable amount of time (6 months to 2 years or longer) before the estate is settled and closed.
Now, what happens if you die without a will and have no estate planning documents in place? In Tennessee, this is referred to as you have died “intestate.” When a person dies intestate (dies without a will in place) you still have to go through probate. However, Tennessee law has determined where your assets will go after all costs, creditors, and attorney’s fees have been paid.
If you die and you are single but have children, then your children will inherit everything equally. However, if you are single, have no children, but you have living parents, then your living parents will inherit everything. If you are single, have no children, no living parents, but you have living siblings, then your siblings will inherit everything that you own at your death. If you are single, have no children, no living parents, no living siblings, then your next closest blood relatives will inherit your property at your death. Finally, if you are single, have no children, no living parents, no living siblings, and no other blood relatives that can inherit, then the State of Tennessee will inherit your property after your death.
However, estate planning is more than just where your stuff will go and who will be in charge of settling your estate after you die, it is about planning for your incapacity as well. Even when I speak with single people that have living blood relatives that will inherit from them, I always discuss putting in place the three very important disability legal documents. These legal documents include (1) Durable Power of Attorney, (2) Healthcare Power of Attorney, and (3) Living Will Declaration.
These three disability legal documents allow you to state a trusted family member (spouse, parent, adult child, or other close family member or friend) to make important financial decisions on your behalf, speak with doctors, and even authorize the withdraw of use of care and life support systems should you ever be in a position where you can no longer make those decisions on your behalf. If you don’t have a healthcare power of attorney and a durable power of attorney in place then your surviving family would be required to file guardianship action in the probate court to have you named incompetent, and then you would have to rely on a judge to name a person to make these decisions on your behalf when you are no longer able to do so. This could result in you laying in a hospital bed, in a persistent vegetative state for weeks or even months before a guardian could be appointed to make the decision to withdraw care and permit you to die naturally.
As you can see, there are very important reasons for even single people to have estate planning completed including:
- Avoiding Probate
- Avoiding Unnecessary Costs and Delays After You Die
- Avoiding Unnecessary Fighting Among Your Surviving Family Members
- Avoiding the Withdraw or Use of Medical Care When You Are in a Persistent Vegetative State
- Avoiding the Freezing of Your Financial Accounts After You Die or When You Are Unable to Make Your Own Decisions
If you have questions about estate planning in Tennessee, establishing a revocable living trust or an irrevocable Medicaid trust, avoiding nursing home poverty and Medicaid planning, or any other estate planning topics, then I encourage you to attend one of our free live educational events scheduled this month. At these events, you will hear a lot of real life stories about families that paid thousands of dollars in unnecessary expenses, families that were able to avoid unnecessary expenses, and families that were able to protect their assets from unnecessary nursing home costs and expenses.
I look forward to speaking with you at one of our upcoming live educational events!