Why it is true that every adult should have at least a basic estate plan in place, that need is heightened for women. Unfortunately, women are often unaware of how important estate planning can be for them. To make sure you and your loved ones are protected, let’s explore what women need to know about estate planning.
How Is Estate Planning Different for Women?
The fundamental need for estate planning is the same for everyone; however, there are some ways in which that need differs between men and women. To begin with, women are statistically likely to outlive their spouse, leaving them to pass down the marital assets to children and other beneficiaries. Women also tend to me the caretakers of the family, making them more likely to be concerned with issues such as designating guardians for minor children as well as being responsible for making plans for aging parents.
What Should Women Include in Their Estate Plan?
Every estate plan should be uniquely tailored to the needs of the person creating the plan. As such, your plan may not include all the following components; however, some common estate planning tools and strategies for women include:
- Medi-Cal planning. Over half of all seniors in long-term care (LTC) rely on Medi-Cal to cover the high cost of that care. Again, because you are statistically more likely to outlive your spouse, you need to plan for the possibility that you will one day need LTC. Medicaid planning is also important to ensure that your spouse does not deplete your entire retirement nest egg if he ends up needing long-term care.
- Last Will and Testament. Executing a Will ensures that you will not die intestate. If you fail to execute at least a basic Will prior to your death, the state intestate succession laws will decide how your estate assets are distributed. Typically, this means that only a spouse and/or very close relatives will inherit from your estate. Close friends, charities, and more distant relatives will receive nothing from your estate. In addition, executing a Will allows you the only official opportunity you will have to nominate a Guardian for your minor children in the event one is ever needed.
- Incapacity planning. Incapacity is not limited to the elderly. On the contrary, incapacity can strike at any time and to anybody. Without an incapacity plan in place, you have no way of knowing who will make health care decisions for you, who will take over control of your assets, or who will make personal decisions if you cannot make them yourself.
- Joint ownership. The way in which you title assets can determine whether the asset is required to go through the probate process or is automatically transferred to the surviving spouse upon the death of one spouse. Titling assets as joint owners with rights of survivorship means that the asset will bypass probate upon the death of one owner and that owner’s interest in the asset will transfer directly to the surviving owner (spouse).
- Retirement planning. Statistics tell us that you are likely to outlive your spouse. This makes retirement planning even more important for you as a woman. You need to be certain that you will have sufficient assets and income to live comfortably if your spouse is the first to go. Because retirement planning and estate planning are so closely related, and a change in one plan almost always affects the other plan, it is always best to combine your retirement and estate planning into one cohesive plan.
Please download our FREE estate planning checklist. If you have additional questions or concerns about estate planning for women, contact us at the Northern California Center for Estate Planning & Elder Law by calling (916)-437-3500 or by filling out our online contact form.