While estate planning is vital for spouses, it is arguably even more necessary for couples who don’t marry. As the leading elder care lawyer servicing Chester County, PA, and the surrounding communities, Slutsky Elder Law understands that with no estate plan in place, unmarried couples won’t be able to make end-of-life decisions or inherit from each other.
Estate planning serves two primary functions: determining who can make decisions for you if you become incapacitated, and who gets your assets upon your death. Certain laws protect spouses in couples that have failed to plan by governing property distribution in the event of death, although those laws are hardly ideal. If you do not have a will, the individually held property will pass to your spouse and children in roughly equal shares or parents if you die without a spouse or children. There are also some safeguards on medical (not financial) decision making while you are alive. Again, these are not ideal.
There are no laws in place to help unmarried couples. With no solid estate plan, your partner may be cut out of the decision making and receiving of property intended for their benefit. Here are a few estate planning steps that can help unmarried couples:
Joint Ownership
One way to ensure property passes to an unmarried partner is to own the property jointly, with right of survivorship. This means if one joint tenant dies, his or her interest immediately ceases to exist and that the remaining joint tenants own the property in full.
Beneficiary Designations
Review bank accounts, retirement funds, and life insurance policies to make sure your partner is named as the beneficiary. If not, your partner will not have access to any of these accounts.
Durable Power of Attorney
One or more people act on financial and legal matters in your incapacity. Without this, if you become disabled or otherwise unable to manage your affairs, your finances can become disordered, and your bills not paid. This could place a significant burden on your partner, who might have to go to court to seek the appointment of a guardian, a costly and time-consuming affair.
Healthcare Power of Attorney
This appoints an agent to make health care decisions for you when you are not able to yourself, whether temporarily or permanently. Without this document in place, your partner could be shut out by other family members or forced to try and be appointed guardian in court. If it is crucial for your family members to be able to communicate with healthcare providers, a HIPAA release will permit medical personnel to share information with anyone and everyone you name.
Will
This document says who will get your property after you die. Today, many people bypass the will and name beneficiaries on their assets. However, this may not be the best choice since a will can place protective provisions on the property. Plus, if you have children that are minors, it permits you to name your preference for their guardian in the event that you cannot continue your parental role. Additionally, it allows you to select your representative (also referred to as an executor or executrix) to handle everything that has to do with your estate. These tasks include distributing your possessions, paying bills, filing your final tax return, and closing your accounts.
Revocable Trust
This can be especially important for unmarried couples, as it permits the persons you name to manage your financial affairs and avoid probate. You can name one or more individuals to serve as co-trustees, allowing you to work together on your finances and seamlessly take over in the event of your incapacity.
Probate avoidance is not really an issue in Pennsylvania. Still, if you are moving to a state where probate is expensive or complex, a properly administered living trust can assist. Trusts can have downsides for some estate planning purposes, so it is important to understand its place in the overall plan when considering a trust or any other estate planning tool.
Your personal estate planning attorney can help you determine the estate plan that is right for you and your partner. For more information about how we can help you plan for the future, including legal guidance on Medicaid applications near Montgomery County, PA, contact Slutsky Elder Law today!