Estate Planning Essentials for Unmarried Couples in Bucks County, PA
Estate planning helps ensure your financial and personal assets are distributed according to your wishes if you are incapacitated or after your passing. While it’s an important task for everyone, estate planning carries special significance for unmarried couples. In this article, we’ll explain why estate planning in Bucks County, PA is particularly critical for unmarried couples and provide a step-by-step roadmap to ensure peace of mind.
Why is estate planning critically important for unmarried couples?
While estate planning is valuable for married couples, it is arguably even more critical for unmarried couples. Let’s compare what happens when married versus unmarried couples do not have an estate plan to help understand why.
Married couples without an estate plan
When married couples don’t have an estate plan, the surviving spouse is protected by laws governing property distribution. If they do not have a will, the regulations state that property will automatically pass to the surviving spouse and children or their parents if they die without a spouse or children.
Unmarried couples without an estate plan
Conversely, when unmarried couples don’t have an estate plan, there are no laws to protect the surviving partner. Without the same protections as married couples, unmarried partners wouldn’t be able to inherit from each other or make end-of-life decisions on behalf of their partner.
If you’re unmarried and want to avoid circumstances where you may be shut out of end-of-life decisions and inheritances, estate planning in Bucks County, PA provides legally binding protection and peace of mind for both of you.
The role of estate planning for unmarried couples in Bucks County, PA
Whether you’re married or not, estate planning in Bucks County, PA serves two primary functions:
1. To determine who can make decisions for you if you become incapacitated
2. To determine who inherits your assets when you die
As we covered in the previous section, these functions are especially vital for unmarried couples who aren’t protected by the same governing laws as married couples. A solid estate plan helps both partners to legally document their wishes in the same way as a married couple.
What does estate planning entail? In the next section, we’ll cover six steps for unmarried couples to follow when estate planning in Bucks County, PA.
6 essential estate planning steps for unmarried couples
If you’re in an unmarried partnership, the following are six steps that can help you navigate the process of estate planning in Bucks County, PA:
1. Own property jointly
Joint property ownership with a right of survivorship is one way to ensure property passes to an unmarried partner. If one joint tenant dies, their interest immediately ceases to exist, and the remaining joint tenant(s) own the entire property. Joint property ownership is an estate planning strategy for unmarried couples that also avoids the hassles of probate.
2. Designate your partner as your beneficiary
The next step of estate planning in Bucks County, PA for unmarried couples is to review the beneficiary designations on your bank accounts, retirement funds, and life insurance. If you would like your partner to access those accounts upon your death or incapacitation, name them as the beneficiary. Unfortunately, your funds will not be available to your partner without this specific beneficiary designation.
3. Appoint a financial power of attorney
A financial power of attorney appoints one or more people to act for you on financial and legal matters in the event of your incapacity. Without one, your finances could become disordered, and your bills may go unpaid if you become disabled or unable to manage your affairs, risking a tremendous burden on your partner. If you’re unmarried, consider appointing your partner as your financial power of attorney. This simple document can save them time and money in court to seek a guardianship.
4. Appoint a health care power of attorney
Like a durable power of attorney, a health care power of attorney appoints someone you trust to make health care decisions on your behalf if you can’t do so for yourself, whether permanently or temporarily. By selecting your partner in this document, you’ve assured their involvement in your health care decisions without them having to go to court for guardianship. If it is important for all your family members to communicate with health care providers, a broad HIPAA release — named for the Health Insurance Portability and Accountability Act of 1996 — will permit medical personnel to share information with anyone you name.
5. Make a will
One of the most well-known estate planning strategies, a will is a document that says who will inherit your property and assets after your death. Wills are increasingly irrelevant for this purpose as most property passes outside of probate through joint ownership, beneficiary designations, and trusts. However, a will is still important for an unmarried couple for two other reasons:
• If you have minor children, a will permits you to name their guardian if you are not there to continue your parental role.
• A will allows you to select your personal representative (also called an executor or executrix) to take care of everything having to do with your estate, including distributing your possessions, paying your final bills, filing your final tax return, and closing out your accounts. Whether it’s your partner, or someone else, it’s best that you choose who serves in this role.
6. Establish a revocable trust
A revocable trust can be especially important for unmarried couples completing estate planning in Bucks County, PA. It permits the person or people you name to manage your financial affairs on your behalf and avoid probate. You can name one or more people to serve as co-trustee with you so that you can work together on your finances, allowing them to take over seamlessly in the event of your incapacity or death.
5 Benefits of estate planning for unmarried couples
If you’re in an unmarried partnership, estate planning comes with a lot of advantages. The following are five core benefits to consider.
Upon your death or incapacitation, estate planning in Bucks County, PA allows you to legally:
1. Pass property on to your partner
2. Grant your partner access to your financial accounts
3. Appoint your partner to make financial or health care decisions on your behalf
4. Designate your partner to inherit your assets upon your death
5. Help your partner avoid probate
Even with a roadmap, estate planning has many variables that are unique to every couple. In the next section, we’ve rounded up several frequently asked questions to shed even more light on this increasingly relevant estate planning topic for many unmarried couples in Bucks County, PA.
Estate planning FAQs for unmarried couples
How do you begin the estate planning process?
The best way to begin estate planning in Bucks County, PA is to contact an experienced elder law attorney. They will walk you through the process to ensure that your and your partner’s wishes are legally documented. Led by Certified Elder Law Attorney (CELA), E. Garrett Gummer III, our firm is highly experienced in helping unmarried couples navigate the nuances of estate planning.
Do you need an elder law attorney?
An elder law attorney can make the estate planning process easier for unmarried couples. However, there are a couple of steps you can do on your own without one. First, ensure that your property is jointly owned with a right of survivorship to ensure the property will be passed on to your partner without requiring probate. Second, designate your partner as a beneficiary on bank accounts, retirement accounts, and life insurance. An elder law attorney can help you complete the rest of the estate planning process, including power of attorney, wills, and revocable living trusts.
What is the difference between a will and a revocable living trust?
A will is a written legal document permitting you to control the disposition of assets’ distribution after your death. It’s different than a revocable living trust, which allows you to transfer your assets to the trustee for management during your lifetime. You can serve as the trustee if you have legal capacity. You’ll also need to designate your partner or another successor trustee to take over management should you become incapacitated. Upon your death, the trustee will distribute assets according to the trust’s terms without the need to probate your will.
What happens if unmarried couples don’t have an estate plan?
Unmarried couples do not have the same legal protections as married couples regarding property distribution and decision-making. Without an estate plan, they run the risk of not passing on assets or not being allowed to make critical health and legal decisions on behalf of their partner. Estate planning in Bucks County, PA is a critically important step for unmarried couples who want to include their partner in their financial and end-of-life plans.
To learn more about estate planning in Bucks County, PA for unmarried couples, contact our firm today.