Death Benefits for Unmarried Couples
Are you wondering what happens when your partner dies? How will the surviving loved one be cared for? Death benefits for unmarried couples only exist if you create them. You can decide where your assets go—whether you give them to friends, family, charities, or a religious organization is up to you. However, in order to do so you must plan carefully before your death. If you want your partner to have the same death benefits as a married person would, it is imperative to put an estate plan into place.
What Happens When Your Partner Dies?
When partners are married, the surviving spouse automatically inherits many of the assets that their loved one left behind: bank accounts, the home and vehicles, life insurance proceeds, retirement accounts, and so forth. (If the couple has children, the spouse would receive half of the property). Although it’s still important for married couples to write wills and use the benefits of a living trust, the majority of their assets will likely pass to the surviving spouse, even without a will.
For unmarried couples, however, utilizing end-of-life planning tools is not only a good idea—it’s absolutely crucial. Married couples’ benefits do not legally apply to unmarried couples in Arizona. That means your regular, daily life could be exposed to major risk if your partner dies.
A mutually built estate should benefit both parties! Don’t leave any room for that security to be taken away from you or your partner.
What Are the Unmarried Partner’s Rights after Death?
Common law marriage is not recognized in the state of Arizona unless the marriage was legalized in another state. Unmarried partners do not have a lot of rights. If you pass away and are unmarried with no children, your parents will inherit your estate. If your parents are deceased, your estate will go to your siblings. If you are unmarried and share children with your partner, the children will likely be entitled to everything.
In some cases, if the estate was not properly prepared, an unmarried partner could have no rights to the assets. The state may see the partner as legally uninvolved. In the worst case scenario, if you don’t name your heirs or beneficiaries in a will or trust before death, your estate could have to forfeit all of its property to the State of Arizona.
Estate Planning for Unmarried Couples in Arizona
Estate planning for unmarried individuals is just as important as for married couples. Asset protection plans with living wills, trusts, and other tools will help give you peace of mind that your wishes will be followed.
There are several ways to ensure your partner is taken care of the way they should be:
- Use a trust to leave assets and property to your partner.
- Write a will with the help of an estate planning attorney to best cover your partner’s needs in the event of your death.
- Purchase real estate property, like your home, in both your names.
- List your partner as “beneficiary” on insurance policies or in investments.
- Set your vehicles’ registrations to transfer-on-death to your partner.
- Create a trust so your estate can avoid probate court.
Consult an Experienced Estate Planning Firm
Many individuals are under the impression that their will alone is sufficient for their estate to avoid probate. Unfortunately, a will is simply an expression of your wishes and must go through some kind of court process before the assets can be distributed to your heirs.
Because the owner of the property is deceased, a formal legal proceeding will be required to remove the decedent’s name from the property and title the asset in the new owner’s name. Depending on the complexity of your estate and whether any disputes or claims arise, this process can take years.
Avoiding probate is only one of twelve reasons we’ve outlined on why a revocable living trust is beneficial. Let us help you even further by establishing the best laid plan for you and your partner. Give us at Phelps LaClair a call to get started.