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Single individuals face challenges in estate planning

Many single and childless individuals in California will face the complex and open-ended question of how to settle their estate after they die. There are approximately 17 million Americans over the age of 65 who are unmarried. In addition, financial advisers and charitable organizations are reporting that an increasing number of young people are starting to think about estate planning before they get married or have children.

For example, many young tech entrepreneurs are coming into money from the sale of a start-up or stock options. According to financial advisers, a person's age is less important than how many assets he or she has. Individuals whose wealth is over $100,000 should have an estate plan. Otherwise, a person's assets will go to the state.

In addition, a person should designate someone to manage his or her affairs in the event of an illness or accident. Brokerage firms offer a donor-advised fund that act like mutual funds which can be designated for charitable giving. Individuals can make either one-time donations or ongoing contributions to the charity of their choice.

Estate planning can be confusing and complex, especially for high net worth individuals. Estate plans can be individualized based on a person's legal needs. An estate plan can save relatives or beneficiaries the difficulty of going through probate to claim ownership of a person's assets. In the absence of a will for a person with no relatives, an individual's assets may become the property of the state. On the other hand, preparation of an estate plan can ensure that assets go to the beneficiaries or charities desired.

Source: Forbes, "Estate planning for the young, rich and childless", Beth Pinsker, June 02, 2014

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