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Update your estate plan after divorce

On Behalf of | Nov 3, 2021 | Estate law |

Most financial planners agree that individuals should revise their estate plan after every significant life event. These events can include the death of a loved one or the birth of a child. One of the most common events, however, is the end of a marriage. After your divorce, it is crucial that you take the time to revise your estate plan’s documents.

Why is this important?

It is a simple exercise in logic. When you created the numerous documents that form a comprehensive estate plan, you likely focused on your spouse and his or her future well-being. As the marriage comes to a halt, however, your goals for the estate plan might have shifted.

  • Beneficiaries: You should carefully examine your will to ensure it still reflects your wishes. Not only would you have willed numerous assets, either physical or digital, to your spouse, you might have also included your spouse’s family members as beneficiaries of certain assets. You should revise these beneficiaries no matter if they are primary or secondary.
  • Property: Like the beneficiaries in the will, your spouse or their loved ones might be listed as heirs for property transfer. The family home, for example, a vacation home or commercial property must all accurately reflect your situation and future goals.
  • Powers of attorney: When drafting the estate plan, many individuals take the time to name proxies who will make either medical or financial decisions in the event of incapacity. As the marriage ends, you might desire a different person to be responsible for these critical decisions in your future.

In addition to these specific elements of the estate plan, you should also consider your life insurance beneficiary, your various medical insurance plans and retirement accounts if they were not addressed during the divorce’s property division process.

Many individuals are excited to complete the divorce process as it signals the start of a new, independent future. It is wise to remember, however, these critical administrative tasks that must be completed as well.