Life can take unexpected turns, and one significant life event that can profoundly impact your financial and legal affairs is divorce. While the emotional aspects of divorce are undoubtedly challenging, it’s crucial not to overlook the practical and financial implications it can have on your estate plan.
The importance of reviewing and updating your estate plan during and after a divorce is undeniable. This simple move can better ensure your assets and wishes are protected.
Reevaluating your Estate Plan
Estate planning involves making a series of decisions about what happens to your assets, debts and responsibilities after your passing, as well as addressing medical and financial decisions related to the risk of incapacity due to illness or injury while you are alive. It is a meticulous process that ensures your family is cared for and your wishes are fulfilled as intended.
The law states that after a divorce is complete your ex-spouse is disinherited and any power they had as your financial agent and health care surrogate are terminated. Nonetheless, this rule does not apply while the divorce is pending, meaning: (1) if you die during the divorce, your soon-to-be ex-spouse may end up with everything; and (2) during the divorce they retain their authority as your financial agent or health care surrogate. Updating your estate planning documents when a divorce is filed should be a high priority.
Even after a divorce is granted, there may be stipulations in the divorce decree that must be addressed in your Will or Trust. In addition, without careful planning, after your death your assets could still end up under the control of your ex-spouse even though you may be leaving such assets to your children.
That’s why one of the most immediate courses of action to pursue when a divorce is filed is to revisit your estate plan. Updating your Will and/or Trust, Durable Power of Attorney and Designation of Health Care Surrogate is essential to ensuring your assets go to the right people after your death, and while you are alive the right people are there to support you when you need it most.
Sometimes it’s not Your Divorce
Maybe it’s not you who is going through a divorce, but one of your children. With certain updates to your estate plan you can ensure the assets you leave your son or daughter do not end up in the hands of their ex-spouse, even if they share children (your grandchildren).
Divorce is undoubtedly a challenging life event, but it’s also an opportunity to take control of your financial and legal affairs. By diligently reviewing and updating your estate plan, you can better safeguard your interests no matter what life throws your way. Whether your divorce was just filed, has been granted, or you have a loved-one going through one, this life changing event should be addressed with a knowledgeable estate planning attorney. At Marshall Law, we have addressed this issue before, so let us provide the quality legal service you need to navigate this issue.