If you have recently finalized your divorce, your mind may be racing with worry about all the things you should be doing to move forward with your life. Once you and your ex are completely divested from each other’s lives, you should meet with your attorney to update your estate plan. Your divorce will certainly impact many of the legal instruments in your plan.
What Should Change in Your Estate Plan Post-Divorce?
There are many documents that make up your estate plan, and each serves a vital purpose, which is why post-divorce estate planning is an essential part of moving on with your life. Estate plans typically include a will, power of attorney, health directive, and living trust, so you will want to make certain your attorney reviews each document to ensure all necessary changes are recorded. Because so many of the documents in your estate plan deal with what happens should you become incapacitated, it may be improper for your ex to be included in these documents. Your attorney will also need a copy of your divorce agreement to ensure your changes and elections are legal. Your divorce may have stipulated continuing obligations to your ex, and these must be honored to prevent a violation of a court order.
Updating the Pieces of Your Trust
During this process, your attorney will also create new supporting documents if they were part of your original trust.
- Will: Your will outlines where you want your assets to go or how you would want them to be divided upon your death. It may also include custody preferences if you have minor children. Your will should also name an executor to be responsible for executing the provisions of your will. Depending on the number of beneficiaries and the value of the estate, this could be a complicated task. Your attorney will need to revoke your pre-divorce will and beginning anew with a fresh document, which is why it’s imperative that you complete a new will soon after divorce.
- Power of Attorney: A power of attorney is a tremendously powerful legal instrument. It gives another person the authority to make many decisions on your behalf if you are unavailable to do so. You can limit the scope of your power of attorney, but typically it gives vast rights and privilege to the assigned individual to buy, sell, and liquidate assets as they deem fit. It’s very common for these rights to be assigned to your spouse, so it’s imperative to change this in your post-divorce estate plan.
- Advance Health Directive: This document gives the named individual the right to make healthcare elections on your behalf should you become incapacitated and unable to make choices for yourself. It’s common for your spouse to be the designated individual for this instrument, so you would want to also change this in your post-divorce estate plan.
Beneficiaries and Guardianships
Many aspects of estate planning involve leaving your assets to elected individuals once you’ve died. Many assets, like retirement accounts and life insurance, allow you to name beneficiaries who will receive access to these accounts in the event of your death. You would need to update your beneficiaries to reflect any changes you would want post-divorce. Your attorney will need to ensure your elections adhere to your divorce settlement agreement as many retirement benefits can require your ex to receive a percentage or continued beneficiary status. It may also be legally required that you keep your ex on your life insurance as well, but it’s best to allow your attorney to advise you about the terms of your divorce settlement as it relates to your estate plan.
If you have minor children, you will need to revisit guardianship for their interest until they reach the age of majority and are able to control their own financial interest. Since a spouse is typically the guardian for your minor children’s interest in the event of your death, you may want to revisit if you would want to change this post-divorce. If your ex has shared custody of your minor children, it may not be an issue if they also control their interest until adulthood, but if you wouldn’t be comfortable with your ex-spouse being in control of the financial interest of your children, you will want to make that clear to your attorney.
Contact Our Elk Grove Estate Planning Lawyers
Planning for how your estate will be distributed to your loved ones following your passing is a sensitive issue. When you turn to Samra Dhillon & Associates, you can work with a team of compassionate legal professionals who do not take these matters lightly and always have your best interests in mind. Rely on us to help you create an estate plan that is right for you and your family. Call us at (916) 571-1550 to schedule a consultation today.