Divorcing Clients – 5 Important Estate Planning
Matters to Take Care of
- Make sure to change your beneficiary designations. Your soon to be ex-spouse should be removed as beneficiary from your life insurance, retirement accounts, annuities, etc. Also make sure any payable on death or transfer on death designations are changed.
- Make sure access to your various online accounts (facebook, email, banking, etc.) is dealt with. Most clients will not want their ex to have access to this information.
- Update your Powers of Attorney for health care and property. Most married couples name their spouse as first agent to make health care or financial decisions. Now that you are divorced, you probably want to name someone else. And if you don’t already have Powers of Attorney, now would be the time. There are laws in place that provide a priority listing of who can act in your behalf, and if you are deemed incapacitated while still going through the divorce process, the soon to be ex is the first on the list.
- Your Will should be revised. In most cases, you will not want your ex-spouse to receive your estate, so you will want to change the same to provide for your children, parents, siblings, or whoever you deem appropriate. Further, if you named your ex-spouse as executor, you will want to pick someone else. Please seem item number 5 regarding additional matters to consider regarding your Will.
- Your revocable trust should be revised for the same reasons as listed above regarding your Will. You may also want to consider creating a revocable trust to place your assets in. With just a Will, you run into the possibility of your soon-to-be ex renouncing your Will if you were to die before the divorce is final. If this happens, your not quite ex-spouse would receive 1/3 of your estate, even if you had changed it to take them out. With a revocable trust, as long as the assets are funded during your lifetime, the soon-to-be ex-spouse can’t renounce it.