Did you know that women are the head of household for nearly 45% of American homes? Did you also know that the U.S. Census Bureau reported that of 13 million unmarried parents, 80% were women?
We're not sure about you but that seems like a lot of independent, phenomenal women running the show. Ranging in age, ethnicity, education, and income, these ladies all share at least one commonality. They make decisions for their families every day. What their children eat, what they wear, who they spend time with, where they attend school and who provides medical care.
However, in most cases these parents haven't considered estate planning and how their parenting status affects their children if something were to happen to them before their children turn 18.
When planning for the future, it's a good idea for single mothers to get their estates in order by considering the following:
1. What's the status of the biological father? Ordinarily, a child’s father maintains a relationship with the child and will step in as the primary caretaker if the mother becomes incapacitated or dies. However, if this isn’t the case, you should consider who you trust to raise your children if you become incapacitated or die. Regardless of the scenario, document your wishes in your estate plan to avoid any unanswered questions your loved ones may have.
2. Who would you designate as guardian and/or conservator? Even though in most cases the biological father will be given custody of a child if the mother dies, a single mother has the option to name a guardian in the event that the biological father is unable or unwilling to take care of the child.
3. Who do you trust when it concerns managing your assets or any money you leave to your minor children? You should consider choosing someone who you know will act in the child’s best interest and make financially sound decisions that will result in the money being sufficient to meet the child’s physical, medical, and educational needs and to make sure there is still money remaining when the child turns 18.
4. Name the right beneficiary. Did you know minor children can only inherit up to a certain amount? Be sure to name a proper beneficiary who can responsibly manage property for minors. In Georgia, if a child inherits more than $15,000, the money has to be managed by a conservator until the minor turns 18, unless a Trust has been established to hold the funds for the minor’s benefit. Additionally, revisit your beneficiary designations on all insurance policies, retirement accounts, bank accounts and any investment accounts. If beneficiary designations are not made, your family may be forced to go through Probate Court to access the funds at which time the funds may be subject to creditor’s claims. You should consider naming a custodian on the account to manage for the benefit of your children or if you establish a Trust, naming the Trust as the beneficiary.
5. If you become incapacitated, who will make financial and medical decisions on your behalf? Do you have a healthcare directive and power of attorney? When an emergency happens that prevents you from making decisions for yourself and your family, you want to have already designated a person to step in to this role. They can be a trusted relative or friend. In either regard, you want to have the peace of mind that someone is there to take care of you and your estate. After all, It can be difficult and costly for family or friends to step in during emergency situations to take care of your property and minor children when no one has been designated to make decisions for you.
So even if you think that you have it all figured out, take time to consider what it truly means to have it all in order. Schedule a consultation with The Ruffin Firm so we can start planning for you, your future and your children's future.