Single and childless? You might think you don’t need estate planning. But you might be wrong. Here are some things to consider.
Even if you are single, childless, and don’t have any immediate family members to inherit your estate after you die, there’s still plenty you can do in terms of estate planning.
“Regardless if there are no heirs, everyone should still have an estate plan,” said Erin Voisin, director of financial planning at EP Wealth Advisors. “Do you want the state to figure that out for you?”
When considering estate planning with no heirs, creating a will is one of the basic steps you can take. If you die without one (referred to as “intestate”), the state where you live will divvy up your assets as it sees fit, and the outcome may not be what you intended. If no heirs are found, your property may be escheated, which means the state gets to keep it.
David Shulman, an attorney with Florida estate planning law firm Ginsberg Shulman, wrote in a blog post: “As my old property professor used to say, ‘They call it escheat because you got es-cheated!’”
So what’s involved with creating a will? The main thing is deciding who you want to receive your assets. You can leave your stuff to anyone you want, such as your spouse, an extended family member, close friend, or charitable organization. And if you have a fur baby, be sure to include arrangements for their care.
Get access to tools to help you with retirement planning.
You’ll also need to choose an executor for your will who will oversee the distribution of your property. Once again, you can pick whomever you want, but it should be someone you trust and who is willing to serve in this capacity. It’s generally a good idea to talk to the person beforehand to make sure they want to take on this responsibility.
In addition to writing your will, you may also want to think about:
Wills and trusts both allow you to designate someone (a “trustee" in the case of a trust) to hold assets for your beneficiaries or charities and release the assets according to your wishes.
But unlike a will, a trust will typically skip over the probate process, which could allow your beneficiaries and/or charities to receive assets more quickly.
There are many different kinds of trusts, so choosing the right one is important.
Let’s say you don’t wish to designate any family or friends to inherit your property, so your estate plan has no heirs. In that case you may want to consider a charitable remainder trust.
You fund the trust with assets, and then the trust pays you over time. When you die, what’s left goes to charity. With these vehicles, you can set yourself up for retirement income and at the same time create a future donation to a cause you really believe in.
People who don’t set up charitable remainder trusts can list charities in their distribution plans or as beneficiaries of accounts, in the same way they would for friends, Voisin said.
While all this may not sound like the most fun thing to do on a weekend, consider what’s at stake and the power a little forethought can mean for your assets. As Voisin puts it, estate planning, with or without heirs, is “control from the grave.”
for thinkMoney ®
Financial Communications Society 2016
for Ticker Tape
Content Marketing Awards 2016
TD Ameritrade does not provide legal or tax advice. We suggest you consult with a tax-planning professional with regard to your personal circumstances.
All investing involves risks, including loss of principal.
TD Ameritrade and all third parties mentioned are separate and unaffiliated companies, and are not responsible for each other’s policies or services.
Market volatility, volume, and system availability may delay account access and trade executions.
Past performance of a security or strategy does not guarantee future results or success.
Options are not suitable for all investors as the special risks inherent to options trading may expose investors to potentially rapid and substantial losses. Options trading subject to TD Ameritrade review and approval. Please read Characteristics and Risks of Standardized Options before investing in options.
Supporting documentation for any claims, comparisons, statistics, or other technical data will be supplied upon request.
The information is not intended to be investment advice or construed as a recommendation or endorsement of any particular investment or investment strategy, and is for illustrative purposes only. Be sure to understand all risks involved with each strategy, including commission costs, before attempting to place any trade. Clients must consider all relevant risk factors, including their own personal financial situations, before trading.
This is not an offer or solicitation in any jurisdiction where we are not authorized to do business or where such offer or solicitation would be contrary to the local laws and regulations of that jurisdiction, including, but not limited to persons residing in Australia, Canada, Hong Kong, Japan, Saudi Arabia, Singapore, UK, and the countries of the European Union.
TD Ameritrade, Inc., member FINRA/SIPC. TD Ameritrade is a trademark jointly owned by TD Ameritrade IP Company, Inc. and The Toronto-Dominion Bank. © 2019 TD Ameritrade.