According to the Pew Research Center, there are close to 20 million cohabitating adults in the United States as of 2019. A growing number of those are people over the age of 50. In fact, the number of cohabitating couples over age 50 grew 75 percent in just ten years. An Indianapolis estate planning attorney at Frank & Kraft explains why estate planning is essential for cohabitating couples.
The Changing Times
Not all that long ago it was almost unheard of for two unmarried people of the opposite sex to live together. In fact, according to figures released by the U.S. Census tell us that in 1968 only 0.1 percent of 18- to 24-year-olds and 0.2 percent of 25- to 34-year-olds lived with an unmarried partner, according to the Current Population Survey. Those same figures show that 50 years later, in 2018, almost 10 percent of 18- to 24-year-olds cobabitated and 15 percent of 25- to 34-year-olds lived with an unmarried partner. The law sometimes changes slower than society though which is one reason why you should have a comprehensive estate plan in place if you are cobabitating.
How Can Estate Planning Help Cohabitating Couples?
If you are among the millions of Americans who have decided to put off, or forego altogether, getting married and are currently cohabitating, estate planning takes on a heightened importance for you. Having a comprehensive estate plan in place can help protect you and your partner in several important ways, including:
- Avoiding intestate succession laws – if you were to die without at least a basic Last Will and Testament in place, you would leave behind an “intestate” estate. When that happens, the state intestate succession laws determine what happens to your estate assets. Although state intestate succession laws can vary somewhat, they all distribute an estate to a spouse and/or close relatives only. Because you are not legally married, your partner would receive nothing from your estate – no matter how long you have been together. He/she would not even be entitled to sentimental personal property that you would undoubtedly want him/her to have. Executing a Will, however, allows you to gift any – or all – of your assets to your partner.
- Incapacity planning – if you were to become incapacitated tomorrow, someone would have to take over control of your assets and make certain decisions for you. You might want that person to be your partner; however, the law would not favor appointing him/her should it become necessary for a judge to decide. Creating a revocable living trust that appoints you as the Trustee and your partner as the successor Trustee can help resolve this dilemma. Major assets are transferred into the trust and if you become incapacitated, your partner takes over as the Trustee, giving him/her control over those assets without the need to seek judicial approval.
- Health care decisions – there may come a time when you are unable to make your own medical decisions. Someone might even have to make life-sustaining, or life-ending, medical decisions for you. If you want your partner to make those decisions, you need to execute the appropriate advance directive because if a judge is forced to decide who will be your health care agent your partner will not likely be appointed.
- Funeral and burial planning – like many people, you may have very strong feelings about how your body is handled following your death and about your own funeral and burial. You, however, won’t be around to ensure that your own wishes are honored. Someone else will decide what happens. Once again, if there is a dispute as to who is in charge, a court will likely appoint a close family member instead of your partner because you were not legally married. Incorporating a funeral and burial component into your estate plan can resolve this potential disaster.
Contact a Indianapolis Estate Planning Attorney
For more information, please download our FREE estate planning worksheet. If you have additional questions or concerns about estate planning for cohabitating couples, or if you are ready to get started on your plan, contact an experienced Indianapolis estate planning attorney at Frank & Kraft by calling (317) 684-1100 to schedule an appointment.
Mr. Kraft assists clients primarily in the areas of estate planning and administration, Medicaid planning, federal and state taxation, real estate and corporate law, bringing the added perspective of an accounting background to his work.
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