Estate planning is crucial for all individuals, but it becomes even more critical for unmarried couples. Whether you’re in a long-term committed relationship, living together, or planning a life with your partner without marriage, it’s essential to create a comprehensive estate plan to safeguard your partner and assets. To protect your partner and assets, there are some estate planning essentials you need to know.
Unmarried Couples’ Legal Challenges
There are many social and personal advantages to being an unmarried couple. According to the U.S. Census Bureau, nearly 17 million couples (roughly 7%) are unmarried. Unmarried partners also tend to be racially diverse, obtain higher education, and earn higher income than they did about 20 years ago. Clearly, there are advantages and many American couples are choosing to opt out of marriage. However, unlike married couples, unmarried partners do not have the same legal protections and rights when it comes to inheritance, medical decisions, and asset distribution. Given this, unmarried couples can and should plan ahead in order to protect their assets as a couple.
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Creating Wills and Living Trusts
Wills serve as vital instructions for judges regarding the distribution of your assets. In the absence of a will, your partner’s assets might not be allocated in alignment with their desires. For instance, in the scenario of your partner’s death without a will, should they have intended to leave you a monetary asset, you could face challenges in receiving it. This situation could necessitate probate litigation if a family member or next of kin lays claim to the asset. By incorporating your partner into your will, you can significantly enhance the likelihood of your assets being distributed according to your preferences.
Creating a Revocable Living Trust stands as a robust and secure choice for unmarried couples. While a joint trust might not be the most recommended approach for unmarried couples, opting for separate trusts is a viable alternative. Through a Revocable Living Trust, you gain the ability to designate your partner both as a trustee and beneficiary. This empowerment enables your partner to oversee the distribution of your assets. The notable advantages of a revocable living trust include the flexibility to update or revoke the trust when major life events occur and the valuable capability to bypass the probate process.
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Beneficiary Designations
Married couples often enjoy the advantage of the surviving spouse automatically inheriting the deceased partner’s personal and financial assets. However, this advantage doesn’t extend to unmarried couples, as per default state laws, next of kin or other relatives become the automatic beneficiaries of their estate. By designating your partner as the primary beneficiary, you can guarantee a direct transfer of assets to them. This strategy effectively circumvents the possibility of protracted and costly legal procedures..
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Powers of Attorney and Health Care Directives
In a nutshell, Powers of Attorney (POA) allow whoever is designated as your POA to act on your behalf. This includes a Financial Power of Attorney (FPOA), Health Care Power of Attorney (HPOA), and Mental Health Power of Attorney (MHPOA). A FPOA allows the person designated to act on your behalf financially in case of your incapacitation or death. HPOAs and MHPOAs allow the designated person to have access to your health care information if signed with a HIPAA waiver and to make medical decisions on your behalf. Without making your partner your POA, because you are unmarried, they won’t be able to help you in those situations despite your long-term partnership. Designating your partner in your POAs and health care directives gives them the ability to help you in your times of need without court intervention.
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Joint Ownership and Tenancy
When you and your partner make a joint purchase of a home or other real property, it holds significance to acquire the property as Joint Tenants with Right of Survivorship. This arrangement ensures that in the event of either partner’s passing, ownership of the property seamlessly transfers to the surviving partner, eliminating the need for complex legal processes.
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Estate planning extends its importance beyond married couples, encompassing unmarried partners who also require safeguarding for both themselves and their assets. Collaborating with adept estate planning attorneys at Windrose Law Center empowers unmarried couples to customize their estate plans, catering to their distinct requirements. This collaborative effort guarantees the well-being of their partner and the precise distribution of assets as per their desires. Keep in mind that taking proactive steps in planning today can provide a future of tranquility and assurance for both you and your partner.