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Un-Married Couples

With More People Living Together without Getting Married, Planning is Essential.

Question: My lady friend and I -- she is 62 and I am 67 -- decided not to get married for a lot of reason, but we still want to be able to have each other handle our assets and affairs should the other become ill and to leave each other assets in our wills. What do we need to do and what documents do we need?

Answer: Because unmarried co-habitants have many issues to consider and because no one document can solve your problems, you must take a coordinated approach to the planning process. Last week, we discussed durable powers of attorney and wills to carry out your desires. This week, living trusts and health care planning documents. And, again, we strongly suggest that you find a competent lawyer and other professionals with whom you can discuss the specifics of your particular situation based on the law of your state before documents are prepared.

Living trusts, sometimes called "loving trusts," have been touted for years as a way to save lawyers' fees, probate costs, and the expenses of estate administration. For unmarried cohabitants, using these documents as part of a coordinated plan may not only reduce the potential of challenges by families, but also provide an easier transition should death or disability of a partner occur. Since a living trust is a revocable trust, you can change or terminate it at any time while you are competent. Properly prepared and implemented, a living trust can allow you and your partner to carry out your wishes -- in both life and death, leave you in charge of your wealth until you die, and avoid probate. But before you decide to use a revocable living trust, make sure you understand the long-term effects and what it will -- and won't -- do for you and your partner. Since there are no tax benefits, your estate will still include whatever assets may be transferred into the trust.

If your assets include a business owned and operated by you and your partner, then business continuation and succession are important issues to consider because a remaining partner should not find himself or herself left with unwanted "new partners" or the businesses being sold to try to raise cash to pay unexpected estate taxes or as part of a dissolution.

Today, unless you plan for the potential cost of health care and long-term nursing home, the rest of your planning strategy may be wasted. Just like your right to say how your property will be distributed through your will, you also have the right to make your own healthcare decisions. And, just like not having a will, if you don't make your healthcare wishes known before the need arises, you may forfeit your rights to others who know little, if anything about your desires.

"Advance Healthcare Directives" are a number of documents that you can use to express your wishes about your future medical treatment. These documents take effect when you become incapacitated and are unable to make decisions. Until then, you can change or revoke them. The law of each state is different, but generally, there are two basic types of advance directives: living wills and durable health care powers of attorney.

The living will allows you to direct your medical provider to control the use of extraordinary medical treatment that could otherwise be used to fruitlessly prolong your natural process of dying if you are terminally ill or suffer from a permanent condition defined by your state legislature. These documents become effective only in the event of an end-of-life condition where death is expected in "a short time" and where the patient is incapable of making healthcare decisions. In most states, two or more physicians must certify the condition before the living will becomes effective.

But having a living will does not always mean that you are in control of all of your potential health care decisions because you may be unconscious without being in a terminal or end-of-life situation. To whom would you want your doctors to turn to make your treatment decisions? Who would you want to visit you in the hospital? If you do not make your wishes known in writing, then your blood relatives, not your partner, will probably make these decisions for you even though they do not know what you may have wanted.

In order to fill in some of the gaps that the living will leaves, many attorneys advocate a Durable Power of Attorney for Healthcare through which you can appoint a health care agent. This document can be made sufficiently flexible to allow your chosen agent to deal with unforeseen developments according to your desires.

Need more advice or help with this topic? Click here to get information about taking the "Next Step".

Create your personal health plan now and make your wishes known ® using My Final Decisions

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Planning Your Future with 20-20 Vision™



Today, more than 36 million Americans are age 65 or over. There are more than 22 million family-member caregivers. Then there are the Baby Boomers. All are grappling with the major decisions that accompany the latter stages of life. This book is for them. Written by two experts with decades of experience between them, it is a comprehensive guide that instructs readers about how to create a plan to deal with all aspects of aging, helps maximize options and ensure wishes are carried out.

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Create your personal health plan now and make your wishes known ® using My Final Decisions
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