Think estate planning is just for parents? Here’s why childless singles and couples need to do it too — before these third parties take over

“You can’t get an elective surgery unless you have an emergency contact,” she told CNBC Make It (1). “Those are the things that we run up against when time’s too late.”

A Pew Research Center survey found that one in four childless Americans aged 50 and older worry about having someone who will care for them (2). It’s a legitimate concern.

Nearly one in four (24.3%) Americans aged 65 to 74 have disabilities. That rises to nearly one in two (45.0%) of those aged 75 and up (3).

While not all older adults with disabilities will need help making decisions, those with cognitive impairment will. Cognitive decline tends to affect men by age 70 and women by age 73 (4).

That’s why it’s important to think about who will make decisions on your behalf if you become incapacitated. You can do that by assigning Power of Attorney as part of an estate plan.

Because if you don’t take control, others will.

If you don’t take control, others will

If you don’t specify someone to act as your power of attorney in the event you’re incapacitated, the government or health care system may end up making decisions for you (5).

If you’re a childless couple, it’s equally important to do proactive financial planning as part of your estate plan. That could include:

• setting up jointly owned assets
• putting assets into trusts
• and ensuring you have designated your partner or someone else as beneficiaries for your accounts.

A will is essential. When one spouse passes, it’s likely that most of the deceased’s estate will go to the surviving spouse, but without a will, your estate can get tied up in probate, which can be time-consuming and costly.

If you’re the last surviving spouse in a childless couple and you die without a will, the state will distribute your assets to next-of-kin based on the state’s own hierarchy — usually surviving parents, then siblings, then more distant relatives.

The only way you can guarantee your final wishes are fulfilled — with your estate distributed to a nephew or niece, an old friend or preferred charity, for example — is with written instructions in a will.

Priorities for an estate plan if you have no children

As mentioned, a key aspect of an estate plan if you have no children is to set up a durable power of attorney, designating someone you trust as an ‘agent’ with the power to make financial decisions on your behalf if you become incapacitated due to an accident, illness or cognitive decline.

You may want to set up a living trust into which you can transfer assets, with instructions to a trustee as to how they are to be distributed upon your incapacitation or death.

You’ll also want to set up a health care plan that includes advance directives including (6):

• a durable medical power of attorney, assigning someone you trust to make health care decisions on your behalf if you become incapacitated.
• a living will, which will outline your treatment preferences, such as whether you wish to receive CPR if your heart stops beating.

Advance directives can also be used to express other wishes, such as whether you want to be visited by clergy or donate your organs.

The names of these documents and the rules governing them vary by state so it’s a good idea to consult an estate lawyer when drawing them up.

One of the hardest decisions to make around these preparations is who to designate as your health and financial powers of attorney (7).

This decision can be even more complex when you’re childless. This person needs to be trustworthy, reliable and organized.