End of Life Planning

3/14/2024 | By Janet Bodnar

For many retirees, plans for future care often include relying on family for some assistance. But elder care for singles becomes more tenuous. How can singles with no close relatives plan for care late in life?

The short answer is that they should be doing much the same things as people who have families — except that their situation can be more complicated, so they may have to take extra steps.

“Estate planning is fundamentally important for singles,” says Erin Smith, director of estate planning for Edelman Financial Engines.

In particular, you need to draft a durable power of attorney naming someone as “attorney-in-fact” to make financial decisions on your behalf should you become incapacitated, and you should appoint a health care proxy to handle medical decisions.

If you die without a will, state law determines how your assets will be distributed. But, says Smith, “no state has a statutory list of people to make financial decisions for you.”

Although adult children often fill this role, it’s fine to cast a wider net. “I don’t necessarily think of ‘family’ as blood relatives,” says Suzanne Blankenship, author of “How to Take Care of Old People Without Losing Your Marbles.”

“I define ‘family’ as people who make me feel at home — someone like a trusted friend or colleague.” Even more important is that your representative be both financially savvy and trustworthy.

Man fishing and sitting on fold out chair

If you don’t know anyone who fills the bill, you can always hire a professional, such as an estate-planning attorney, a trust company or, in certain states, someone who has been licensed as a “professional fiduciary.”

Virginia Wilkins, who is 79 and has always been single, made her first estate plan in 1974 when she bought her first house, and she has been updating it ever since. “I’ve used many different professionals, including attorneys, accountants and financial planners,” Wilkins says. Because we tend to select someone from our own generation, says Wilkins, “as we grow older, so do they, and they could retire or die before we do.”

As a result, one of the first questions she asks is about continuity: “What provisions have they made should they die or become incapacitated?”

More like elder care for singles: Retirement Planning for Single Women

The caveat about defaulting to someone from your own age group applies to your attorney-in-fact as well as your health care proxy. In each case, Smith recommends having a second or third choice from a younger generation as a backup.

And just as you need someone with financial savvy to handle your finances, look for someone with a health care background to make medical decisions, or at least someone who stays calm under pressure.

An estate plan can also deal with issues that are of special concern to singles, such as naming a guardian for pets.

Smith notes that some states impose their own estate taxes, which can kick in on estates that exceed as little as $1 million. Married couples can delay estate taxes till the death of the surviving spouse, but “singles need to plan for their own tax mitigation,” says Smith.

Janet Bodnar is editor-at-large at Kiplinger Personal Finance magazine. For more on this and similar money topics, visit Kiplinger.com.

©2024 The Kiplinger Washington Editors, Inc. Distributed by Tribune Content Agency, LLC.

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Janet Bodnar

Janet Bodnar is editor at large at Kiplinger’s Personal Finance magazine. For more on this and similar money topics, visit Kiplinger.com.