Updating Your Estate Plan After Divorce

Going through a divorce is a complex and emotionally challenging process, often accompanied by significant financial adjustments, especially when children are involved. Amidst the upheaval, it’s easy to overlook the importance of revising your estate plan. However, failing to update your documents can result in unintended consequences, potentially leaving assets to your ex-spouse contrary to your wishes. Whether you’re currently navigating a divorce or have finalized one without updating your estate plan, it’s crucial to review and revise your documents to align with your current circumstances and wishes.

Start with Your Will
Begin by reviewing your will with your estate planning attorney. While a codicil can amend certain provisions, the extensive changes brought about by divorce often make drafting a new will the simplest option. Your most recent will supersedes any prior versions, with your attorney including language to revoke all previous wills.

Updating your will involves more than just removing your ex-spouse as a beneficiary. Considerations such as appointing a new executor and guardianship arrangements for minor children should be aligned with your current situation and preferences.

Address Beneficiary Designations
Many assets pass outside of your will through beneficiary designations on accounts like life insurance policies, retirement accounts, and bank or brokerage accounts with payable-on-death or transfer-on-death provisions. Ensure you review and update these designations to reflect your current intentions, removing your ex-spouse and naming new beneficiaries as necessary. Be aware of federal laws like ERISA, which may override state regulations regarding beneficiary designations in certain qualified plans.

Review Trusteeship
If you’ve established a trust, evaluate the trustee designation, considering whether your ex-spouse should be removed. Exceptions may apply in cases where business interests or special needs trusts for shared children are involved. Seek guidance from your estate planning attorney to determine the appropriate course of action.

Real Estate Holdings
Any real estate properties subject to division in the divorce should be addressed in your estate plan. Update ownership details and designations accordingly to reflect the properties you retain ownership of.

Update Advance Directives and Powers of Attorney
Ensure your advance directives and powers of attorney reflect your current wishes, appointing new representatives if necessary. Select individuals who are capable of advocating for your healthcare and financial interests in line with your preferences. Consider appointing separate individuals for financial and medical powers of attorney to ensure effective representation in both areas.

Taking Action
Depending on your circumstances, you may need to make immediate changes to your estate plan or wait until your divorce is finalized. Communicate your intentions clearly with your attorney, providing details of any asset transfers or changes resulting from the divorce. Your attorney can guide you through the process of updating beneficiaries, executors, guardianship arrangements, and powers of attorney to ensure your estate plan accurately reflects your wishes.

If you have any questions or require assistance with your estate planning needs, please feel free to contact us at (321) 729-0087. We’re here to help you navigate this important aspect of your post-divorce life.