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What Every Single Parent Needs to Know About Estate Planning

What Every Single Parent Needs to Know About Estate Planning

What Every Single Parent Needs to Know About Estate Planning

It is estimated that one-third of American children live in a single-parent household, and single parents are well advised to create an estate plan that provides protection for their children. Having an estate plan can also provide you with welcome peace of mind. Here are the elements of an estate plan designed to help you protect your children:

Will. A Will is a legal document that details your wishes for how your assets should be distributed after you die and designates a guardian for minor children. If you die without one, a Nebraska probate court will make those decisions for you.

Revocable Living Trust. Since minor children cannot conduct business in their own names, they are precluded from inheriting money, property, stocks and other assets directly.  Setting up a revocable living trust enables you to specify the age at which you want your children to receive their inheritance, allowing you to make decisions according to each individual child’s needs and circumstances. Creating a revocable living trust for minor children also protects the inheritance from creditors and even divorce.

Durable Power of Attorney. This provides a person of your choosing with the legal power to handle your finances should you be unable to do so. Powers of attorney can become effective immediately or through a triggering event like a sudden illness or incapacity.

Advance Medical Directive. This document provides the legal right for the person of your choice (your representative) to make healthcare decisions for you in case you become incapacitated and unable to make those decisions for yourself.

Beneficiary Forms. If you are the owner of a qualified plan – an IRA, 401(k), annuity, life insurance policy or another plan that qualifies for income tax benefits – then you need to name a beneficiary for each of these financial plans. If you fail to do so, the assets in each plan will be distributed according to the rules established by the financial institution that regulates the plan. If you leave qualified plan assets to a beneficiary who is a minor and don’t name a guardian, those assets will be managed by a guardian appointed by the court – someone you may not necessarily want to be performing this duty or who may not follow your wishes.

Your legal team at Koenig|Dunne is here to answer your questions about protecting your children and to advocate for your rights .