Planning for Adults with No Children

Recently in my practice, I have noticed something of a trend. That trend is the growing number of older adults who are single, childless and seeking estate planning advice. There are a host of reasons why they are single and childless. Some may have gone through a divorce and never remarried. Some may have been widowed. Some may have focused so much on their careers that they simply never married and had children.

Planning for this set of the population presents some special challenges. The first of such challenges is determining who to choose to serve in various positions of trust, called fiduciaries. Often, when you have a married couple with mature adult children, the couple will look first to the adult children to serve in such positions as executor, trustee or health care agent. When you have an older adult who does not have any children, however, the choice of who shall serve in these positions is not as obvious.

When the single older adult has siblings, often they will think first of appointing a sibling to serve in a position of trust. This, however, can present some special considerations. First, siblings tend to be relatively close in age. Thus, there is a question of whether the sibling will actually pass away first. This could leave the older adult in need of appointing new fiduciaries when their siblings pass away. There is also the risk that once the older adult passes away, the sibling will be unable to take on the role of fiduciary because of factors such as dementia or other health conditions. These problems can be avoided by having the older adult appoint alternative fiduciaries to serve in the event that their first choice either passes away first, or cannot serve for other reasons.

Another potential problem is that siblings may live in different areas of the country. If the sibling must travel a long distance in order to accept an appointment, that may serve as a disincentive to act. In this regard, the older adult should understand that accepting a fiduciary role is voluntary. Even if a person is named in a legal document, that person can still turn down the role.

In some cases, there may be a niece or nephew who is close, in an emotional sense, to the older adult. Such a person may be a better choice, simply because a niece or nephew is likely younger, and thus more likely to outlive the older adult. But, in some cases nieces and nephews may also live quite a distance away from the older adult. Moreover, if the niece or nephew is appointed as an agent to make health care decisions, there could be question of whether that niece of nephew truly knows what the older person would have wanted.

An older adult could look to friends and co-workers. Again, because people tend to associate with others who are close to them in age, this may not alleviate the concern of who will be the first to pass away. Plus, despite friendship, some people may be hesitant to ask someone who is not a relative to take on the burden of administering their estate, or making health care decisions for them.

There may be no simple solution to the dilemma of appointing fiduciaries. At the very least, there should be alternatives named in case the primary choices are unwilling or unable to serve. But, identifying the people who will serve may take some additional time and consideration.

The next issue is exactly what to do with the older adult’s wealth after death. If the older adult has no children, then there will be no obvious choice to inherit that person’s estate. In some situations, the older adult may have done a great job in planning for retirement. He or she may have valuable retirement accounts and investments. He or she may also own real property.

To whom the estate should be left is a very personal question. This may an opportunity for the older adult to leave a legacy, and thus give much of the estate to charity. Perhaps there is a favorite sibling or nephew to whom the older adult would like to leave a gift. Perhaps the older adult has simply not thought about their distribution plan.

What is certain is that if the older adult does not create an estate plan, the state government will create one for them. When a person has not left a will, or placed his or her property in trust, then that is called intestacy. The intestacy laws will then determine who inherits the person’s property. Intestacy laws vary by jurisdiction. But, they tend to favor relatives. Usually, spouse and/or children are the first choice to inherit the estate. If the older adult has no spouse or children, intestacy laws usually look first to see if there is a surviving parent, then brother or sister. In the end, if there is no one to take the estate, then the property will escheat. That means it will belong to the state. If the older adult is not happy with this plan, then it is imperative that he or she think long and hard about how he or she would want his or her property distributed.

The unique challenges presented by single, older adults without children require greater attention and consideration. Consulting with a professional may be helpful, but it may not answer all of the questions. In the end, the choices in creating an estate plan are very personal, and should match a person’s own goals and values.