Estate planning for unmarried couples

More than 11 million people in the United States live with an unmarried partner, according to the 2000 Census. That's a 72 percent increase over 1990 and a significant number of people who can't assume they'll be making decisions for their partners in the event of a medical crisis or death.

Unlike their married counterparts, unmarried partners, even in life-long relationships, are frequently kept out of hospital rooms or funeral decisions. They also may not inherit financial assets intended for them if the right documents are not in place.

Life planning, or estate planning, is important for everyone, but it is even more critical for unmarried couples. Four key documents can ensure the person you want (not merely the family member who is next of kin) will make decisions concerning your life and death when you cannot make them for yourself.

  • Will or trust — Wills and trusts transfer property you hold in your name to the people and/or organizations you want to have it; it also names the person you wish to carry out your instructions and names a guardian if you have minor children. While wills take effect upon your death, a trust takes effect immediately upon execution. Additionally, trusts are more private documents and are not contestable like wills.
  • Health care power of attorney — A health care power of attorney or other health care directive appoints a person you designate to make decisions regarding your medical treatment in the event you are unable to make them for yourself.
  • Living will — A living will is an advance directive that instructs health care providers about the nature and extent of care you want in the event you suffer permanent incapacity.
  • Durable power of attorney for financial matters — This power of attorney appoints someone to act for you and handle your financial matters should you be unable or unavailable to do so for yourself.

In addition, unmarried partners should carefully review how title to property is held (e.g., individually or joint ownership) and beneficiaries for life insurance, IRAs and other retirement plans.

It's also a good idea to outline your funeral and burial arrangements to ensure they are carried out according to your wishes. Not only does it remove guesswork and potential conflict for your surviving loved ones, it also makes their lives a little easier at a very difficult time.

In short, the best way to ensure your wishes are carried out — and your partnership is duly recognized — is to put them in writing. Estate planning documents provide the means for this, assuring your loved one (not state law) makes decisions on your behalf.

Reprinted with permission from Holmen Courier and Onalaska Community Life, July 2005.


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