Divorce can be challenging. Even if both parties are on board, divorce is a significant life shift, and with that comes stress, uncertainty, and change.
As your needs, priorities, and goals take on a new course, one thing you don’t want to overlook is your estate plan. Estate plans typically contain important documents regarding your future wishes, finances, and health mandates.
While married couples generally appoint their spouse as beneficiaries to estate plans, this typically changes with divorce. However, alterations to designations are not automatic and must be legally updated.
Below is a list of documents and designations you’ll want to review and possibly revise following your divorce.
Verify Guardianship For Minor Children
Guardianship documents are an important part of your estate plan. If you have minor children, you may have appointed a legal guardian or conservator to make decisions on your child’s behalf in the event you and your spouse are unable.
Consider if the selected person is still the right choice. If changes are needed, update this document right away.
Name New Beneficiaries
Many legal documents involve naming beneficiaries or a Power of Attorney. Your named beneficiaries will receive assets from your estate.
Review beneficiary and power of attorney designations on all documents, including life insurance policies, retirement accounts, and pay-on-death accounts.
Note that your divorce agreement may stipulate if changes cannot be made to specific accounts.
Update Your Healthcare Proxy
A Healthcare Proxy is a person who is responsible for making healthcare decisions on your behalf in the event you are ever incapacitated and can’t voice your own wishes.
Married couples generally designate their spouse as their healthcare proxy, giving them the authority to make healthcare-related decisions on the other’s behalf.
Understand your Life Insurance policy
Your life insurance policy may not need any alterations. However, having a firm understanding of who is responsible for the policy and who will benefit is a good idea.
Revoke your Will
If you and your ex-spouse started creating an estate plan, you may, at the very least, have a Will. if you appointed your ex as Executor of your Will, you might wish to update this.
If you don’t already have a Will, following divorce is a great time to create one to ensure your assets are handled properly.
Consider a Trust
If you have a Trust, you may want to consider removing your former spouse from the role of Executor or Trustee.
If you don’t already have a Trust set up as part of your estate plan, you may want to consider setting up a Trust to handle alimony and child support and direct funds to your heirs.
A Trust also allows you to legally appoint a Trustee who can control money and assets in your estate for the benefit of your children if you die.
No divorce is easy, but knowing how to handle your Estate Plan after the dissolution of a marriage can help you move forward. I can help you navigate your divorce and your estate plan. Call my office to set up a consultation at (508) 752-2727.