Updating Your Estate Plan After Divorce

Once your divorce is final, you may think you are done with updating your legal documents, but think again! After your divorce is final, you need to update your estate planning documents to protect yourself and your children. Even though you are divorced, if you name your ex-spouse as a beneficiary in your will, that spouse will inherit from you if you do not update it. There are other important and necessary steps to take to update your estate plan, which are outlined below.  

Revise your Will and create new Powers of Attorney, if desired.
Identify your desired beneficiaries in your will regarding your asset distribution. Update or create your power of attorney to appoint a trusted friend or family member to make financial and healthcare decisions on your behalf, should you become incapacitated. If you named your spouse as your “agent” in a Durable or Healthcare Power of Attorney previously, that Power of Attorney naming your spouse as agent is automatically revoked upon divorce. You do want to have new powers of attorney put into place naming a different agent.

Establish a trust for your minor children.
In your will, create a testamentary trust that is established if you die before your children reach the age of majority. Appoint a trustee whom you trust completely to distribute funds to your children as minors. If you anticipate leaving a significant amount of assets to your children, you may want to establish trust terms that permit your children to receive their portions of the trust at an age older than eighteen to prevent your young children from squandering their inheritances.    

Name a guardian for your minor children.
In your will, name a guardian for your minor children in the event that you and your children’s other parent die before the children reach the age of majority. You want to be sure that your wishes regarding your children’s guardian(s) are expressed clearly in a valid will, which will prevent any confusion or discord between your surviving family members about who should receive your children, should the worst happen.

Update your beneficiary designations: Be sure to go through all of your life insurance policies, retirement accounts, investment accounts, POD and TOD bank accounts, etc. and update your beneficiaries. When you’re married, often your spouse is the sole beneficiary of these types of accounts. Once you are divorced, you want to be sure to name whomever you would like to receive these accounts upon your death. If you need to update your estate planning documents now that you are divorced, we can help.

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