Navigating Estate Planning as a Single Parent

Being a parent is more than providing for your children in the now, it is also about providing for them in the future. Estate planning is important for everyone and it can be a little scary for some, as none of us want to think about the worst case scenario. As a single parent, you may be even less inclined to think about what would happen should you no longer be here to take care of your children but planning for the worst case can help you enjoy the best moments feeling peaceful. 

Being a single parent means your child most likely relies solely on you which is why it is particularly important for you to have an estate plan to ensure your wishes and your child’s future are respected.

A critical consideration for single parents when drawing up an estate plan is making the tough decisions and picking the right people to manage your estate. This will come into play in each section of your estate plan.

The Documents You’ll Need 

Overview

1. Will or Trust

2. Durable Power of Attorney

3. Advanced Health Care Directive

Will or Trust

Wills and Trusts are the pillars of Estate Planning, but 67% of Americans do not have them. Dying without a will or intestate means leaving things in the hands of the state. Intestacy laws vary state by state and do not guarantee your preferred outcome will come into effect. 

What is it? 

These documents allow you to detail how you wish your estate to be managed and distributed amongst your beneficiaries. A will is more of a straightforward document and a trust can be a more robust document with specific legal benefits such as bypassing probate and directly transferring ownership of the listed assets from you to your chosen beneficiaries. Learn more about the difference between a will and a trust, here, to help you make an informed decision. 

Why do I need one? 

Especially as a single parent, you want to make sure your children will receive everything they need to succeed even if you are not here to support them. This includes financial assets such as bank accounts, real estate assets such as your home, and also objects with sentimental value such as family heirlooms. 

Picking the right executor of your will is also important as a single parent as they will most likely be in close contact with your child whether they are a minor or not. 

What about Guardianship?

If you have minor children, guardianship is especially delicate. A guardian will be responsible for your child and for ensuring they receive their inheritance according to your wishes. In your will or trust, you can detail the age and circumstances under which your child is to inherit your estate. When picking a guardian, you’ll want to consider a few things, such as: 

• Whether the courts will approve

  • While the courts greatly consider the parent’s wishes when appointing a guardian, they ultimately rule in the best interest of the child. This is why you’ll want to pick someone who’s childcare capacities will be recognized by the courts. 

• Closeness with your child

  • Since you may be your child’s sole provider, picking a guardian who has a quality relationship with your child is important to your child’s emotional well-being. A guardian is more than a physical and financial provider, they should also be able to support your child on a familial and emotional level.

• Life Attitudes

  • Picking a guardian whose attitudes and beliefs align with yours ensures continuity in your child’s upbringing and lets you feel at peace knowing they will be raised according to your values. 

• Stability and ability 

  • Regardless of your closeness with someone, when choosing them as a guardian, you need to make sure they will be capable of raising your child. Their readiness and ability can be assessed on various fronts such as financial, mental, and situational stability, as well as the longevity of said stability. Consider things like age, job and income, living situation, family situation, location, and any other factors that matter to you.

Remember you are not alone, reach out to your loved ones to help you make the right decision. Learn more on how to pick the right guardian for your child, here. 

Durable Power of Attorney

According to the Census Bureau, nearly a quarter of minor children (23%) in the US live with only one parent, which makes the US the nation with the most single-parent households. More often than not, single parents are sole financial providers for their children which makes securing their finances all the more important.

What is it? 

A Durable Power of Attorney allows you to grant authority of your finances to a trusted agent. The person you assign will be able to make financial decisions on your behalf in the event that you should become incapacitated. 

Why do I need it? 

Should anything happen to you, you still want your children to be taken care of in accordance with your wishes. Having a POA in place can help ensure their financial safety no matter what happens. 

When assigning an agent, keep in mind that they will need to be present for your child and help manage your finances in accordance with your wishes and your child’s needs. 

Advance Health Care Directive

What is it?

An Advance Health Care Directive is a document in which you outline your medical treatment wishes and appoint someone to oversee them should you no longer be capable of making medical decisions for yourself.

Why do I need it?

Having an Advance Health Care Directive is important to ensure your health is handled the way you want it to be. Help minimize any emotional strain should you become incapacitated by helping your family know how to best care for you. 

This all sounds great… but, how do I get started? 

At GoodTrust, we are committed to making estate planning accessible, affordable, and as stress-free as possible for all which is why we’ve created our all inclusive Estate+ plan which provides you with all the necessary documents you need in one easy-to-use platform. 

Our Estate+ Plan includes all the documents discussed above and more, such as a Digital Vault for you to keep all of your important documents in one safe place (even those you’re about to create). Get started today, here.