Whether you are a single parent by choice or by circumstance, it is scary to think about what could happen to your children if you should become incapacitated or die unexpectedly while they are still young. It is particularly difficult if their other parent is not in the picture. However, when you sit down to create a comprehensive estate plan, you can put some of your worries to rest. Learn about your options for protecting your children here.
Essential Documents for Incapacitation
As a single parent, your children rely on you for everything, from picking them up from school to keeping a roof over their heads. So what would happen if you were suddenly unable to do these things? If an accident or illness were to land you in the hospital for an extended period, you need to make sure that your home and your children will be taken care of. You can accomplish that with a few key documents:
- Durable Power of Attorney. With this document, you appoint an agent to manage your financial affairs if you become unable to do so yourself. Your agent can pay the mortgage, pay your childcare provider, make deposits, collect benefits, and handle all of your money matters to ensure that your children are provided for while you are incapacitated. Without this document, meeting financial obligations could be delayed, and your children could be affected.
- Healthcare Power of Attorney. This document grants a trusted person permission to consult with doctors and make medical decisions on your behalf. While this usually involves end-of-life decisions, it can also apply in situations where you are unconscious when decisions need to be made.
- HIPAA Waiver. HIPAA protects patients’ private medical information. Without signing an authorization to release your health information to specific people, your loved ones will not be able to get medical information about you in order to make decisions about caring for your children. Multiple people can be named on the waiver.
These documents all take effect upon your incapacitation or absence. In other words, they are effective while you are still alive but unable to make decisions and take care of business. They are particularly important for single parents because you do not have a spouse who would have these rights automatically.
Naming a Guardian in Your Will
The most important document you need as a single parent is a Last Will and Testament that names a guardian for your children if you die while they are still underage. If the children’s other parent is not an option, this is especially vital. If you have full legal custody of your children, you can state in your Will that you do not want the other parent to become the guardian if you die. Grandparents, siblings, or close friends can be named as guardians, but it is essential that you discuss the possibility with them before naming them in your Will, so you know that they are willing and prepared. We recommend naming a single individual rather than a couple, naming one or two backup guardians, and reviewing your Will every year while your children are minors.
Providing for Your Children Upon Your Death
While your Will can specify who you want to inherit what upon your death, it does not allow for much control over how the assets are distributed and when. That is why a Revocable Living Trust is another essential document for a single parent. Through the Trust, you can provide for your children, allocating funds for their care and education while they are minors and distributing the rest of your assets to them at a specified age. You will name a Trustee to manage the funds on behalf of your children, and you can change the terms of the Trust as your children grow up, your assets increase or decrease, or you want to change the Trustee.
Trust Ross & Shoalmire With Your Estate Plan
It’s hard to think about your children having to cope with your illness or death, but it’s even harder to think about them coping when there is no plan in place to protect them. When you sit down with our Estate Planning team, we will take the time to get to know you and to understand your goals for your children. We will then explain all of your options and help you create a plan that puts your children first. Reach out today to find out how to get started.