Immediately after your divorce is finalized, it is important to update all of your estate planning documents. For most people, the documents needing updates may include a will, power of attorney, living will and beneficiary designations. However, if you have minor children, you may want to also consider utilizing some other estate planning tools.
Guardianship
In your will, you can name who you would like to become the guardian of your minor children if you pass away. Typically, the children’s other parent will become their guardian, but if the other parent has a substance-abuse problem or is otherwise unfit to be the guardian of your children, it may be appropriate to name someone else.
A recent Forbes article noted that some people have done this also left enough money in joint bank accounts for the guardians to use on the litigation that would be required to prove the ex-spouses unfit as guardians. Depending on your situation, a creative solution like this may be possible.
Revocable living trust
Even if your ex-spouse would be an appropriate guardian for your children, you may consider creating a trust for your children. Otherwise, if you pass away, the money you leave for your minor children will be controlled by their guardian until they turn 18. If your ex-spouse is that guardian, he or she would have control of the money you leave your children.
To avoid this, you can create a revocable living trust and name a trusted person as the trustee. This person would be able to control the money for your children if you pass away.
Although it is important to examine and update all estate planning documents after a divorce, as a parent you may want to take a few extra precautions. Your children are an important part of your life, and it can be a comfort to know they will be taken care of if you pass away unexpectedly.
