DES MOINES, Iowa, June 25, 2013 /PRNewswire/ -- The traditional family unit that included mom, dad and a couple of kids is no longer the norm according to current U.S. census data.1 More than half of U.S. families are now made up of a single parent household, unmarried couples or single people living alone.
While demographics shift, history doesn't: Many laws are based on protecting the traditional family unit. For example, tax laws allow for filing jointly. Benefit laws allow for sharing medical and retirement benefits. And estate laws allow for "automatic defaults" that designate the spouse as the one to receive property at death or act on the other spouse's behalf in certain situations.
"Single parents need to be aware of how these defaults may affect them," says Alicia J. Klat, an ARAG® Network Attorney and contributor to SupportinaSplit.com, a blog targeted to people who are helping someone through a divorce. "If you're recently divorced or separated, you may not want your ex listed as your emergency contact – or worse, acting on your behalf by default. Creating or updating a few simple documents can help you avoid unintended consequences."
Single parents, non-married couples who live together, and in many cases single people can ensure their intentions are followed by naming a current point-person for decisions relating to health, finances and minor children. While not everyone needs each of these documents, finding out which ones apply to you will ensure decisions are made according to your plan, not your state's legal defaults.
- Health Care Advance Directive names who will make health care decisions, including end-of-life care decisions, if you're unable to make decisions for yourself. In some states known as Health Care Powers of Attorney, Living Will, Designations of Surrogates or Proxies or HIPAA Designation of Personal Representative.
- Property Advance Directive names a guardian and/or conservator if you become incapacitated and cannot handle personal or property matters such as paying bills or making deposits.
- Finance Advance Directive names who can manage your property, either on an ad hoc basis, or for longer periods, if you become incapacitated, either temporarily or permanently. In some states known as Powers of Attorney. If the power granted is not affected by the maker's incapacity, Durable Powers of Attorney.
- Funeral Arrangements Advance Directive names who can specify funeral arrangements and ensure your wishes are carried out. Depending upon the usage in the state, also known as: Declaration of Final Disposition, Declaration for Disposition, Disposition of Remains, Appointment of Agent or Appointment of Agent to Control Disposition of Remains.
- Insurance, Annuity, and Retirement Asset Beneficiary Designations name who will receive the proceeds of insurance, annuities or retirement assets. Contact the company that holds the asset to set up the beneficiary. Generally, you'll receive a beneficiary designation form that you need to complete and return.
- Bank Accounts and Securities Accounts Ownership Designations need to be worded so your intended recipients can receive access to funds if you die or become incapacitated. All these accounts must be set up at the financial institutions holding them, with special attention to the paperwork establishing the form of the account and the beneficiary designations.
- Real Estate ownership is set up within the deed. Work with an attorney to ensure that transfer of ownership is established according to your intentions.
- Living Trust names someone (or several people) to control and manage property. Also provides specific directions on how that property should be controlled, managed and ultimately disposed.
- Will directs how property is to be distributed upon an individual's death. Also appoints persons to carry out the Will, to act as guardians for any of the individual's minor or disabled children, and to act as trustees for property the person wants to be held under Trust for beneficiaries.
To ensure these documents are completed accurately, it is best to consult a competent attorney who focuses on estate planning. For an additional safeguard, you may want to check with your employer about enrolling in legal insurance coverage where you work. Comprehensive legal plans, such as those offered by ARAG, provide plan members with convenient access to a nationwide network of attorneys and tools to help manage estate planning documents, providing security and peace of mind.
1U.S. Census Summary File 1 (Nov 2011).
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