Young, single and in need of an estate plan

Remember that hilarious episode of "Friends" where Ross convinces Rachel, Phoebe and the others to sit down and write their wills and designate durable power of attorney to each other in the event something should happen to them?

Of course you don't; it never happened. Come on, who would believe that?

The sorry fact is, singles don't bother with estate planning, period. Heck, part of the joy of being single is the devil-may-care, no-strings-attached lifestyle. Even the term "estate planning" sounds like something their grandparents would do.

Well, not to be overly grim, but you swinging singles need to plan for the Reaper every bit as much as Mr. and Mrs. Suburbia. In fact, in the opinion of Kyle Krull, a Kansas City attorney and estate planner, singles need it more.

"It's even more important than it is for marrieds, and here's why: In a marriage, it is pretty much assumed that your spouse, even in the absence of any planning, is going to be the person that the court is going to appoint as the guardian over your personal and health care decisions and conservator over your financial matters.

"But if you're single, who is it going to be? If you're age 18 and over, you need to appoint the people to make your personal, health care and financial decisions or the court is going to take a stab at it themselves, and it may not be the party you would want."

Consider these two scenarios. If you're single without kids and you die without a will ("intestate" in legalese), your assets would likely flow to your next of kin in this order: surviving parents, siblings, nieces and nephews. If you are divorced with children, your assets would likely go to your children as next of kin, and should something happen to them, your assets could wind up with your ex-spouse as their next of kin.

That's right, if you don't specify otherwise, your ex-spouse (and his or her new spouse) could get your checks when you check out.

Now that's no laughing matter, friend.

Who'll be there for you?
When Minneapolis money coach Ruth Hayden asks her single clients why they haven't addressed an estate plan, they usually plead poverty.

"Most singles figure they don't have much money, this is not a big deal and they usually don't do planning," she says. "Usually they find they have more than they think."

Hayden starts by adding up their assets. Singles often have a life insurance policy through an employer, perhaps a nominal retirement account fed by their paychecks, equity if they own a home and often assorted accidental death benefits from credit cards and memberships.

She then explains to them who is likely to end up with this modest windfall once their estate has been settled: a parent, a sibling, a niece or nephew.

"Once they realize that they have these things and that their next of kin will be in charge of cleaning everything up and then will get whatever's left over, they pay attention," she chuckles. "That person is also going to dislike them if they haven't made any plans. I tell my clients, if you don't like these people, don't have a will and don't make any plans. But if you like these people, have some order to this."

We plan in order to designate who will be responsible for our personal, health care and financial decisions when we are no longer able to do so ourselves. If we don't, the probate court and typically a gaggle of lawyers will be only too happy to make these calls for us (Krull calls this the "lawyer full-employment program"), in the process making our private affairs a matter of public record.

Krull estimates that seven out of 10 Americans have no estate plan at all, and most of the 30 percent who do have not kept them up to date with current tax laws. You may have every intention of leaving your nephew your Jimi Hendrix autographed guitar, but without a will, the court is going to sell that off in an estate sale so the money can be distributed. It can be heartbreaking to see relatives at estate sales "buying back" family heirlooms that you fully intended to pass along, someday.