Divorce can often induce feelings of uncertainty, as one tries to figure out what life will look like post-separation.
While there are many important issues to contend with during a divorce—such as child custody and asset division—one task that can’t be overlooked is updating an estate plan.
Estate plan updates to make after a divorce
When you go through a divorce, you split up a life that you built with your spouse. Because of this, you may want to update your estate plans to reflect your current situation and wishes.
- Guardians: If you have children that are minors, you may want to make or amend provisions for their guardianship—should something ever happen to you.
- Powers of attorney: Powers of attorney allow a third party to manage your affairs if you ever become incapacitated. Couples often name one another as their agents with powers of attorney. After you’ve separated, you will have to update these powers if you don’t want your ex to still act as your agent.
- Beneficiary designations: After a divorce, you may want to re-evaluate the beneficiaries of your estate. You should update your plans for the beneficiaries of your will, so your assets go where you intend them to. Furthermore, you may change the beneficiaries of any life insurance and retirement plans that you have.
- Trusts: If you can, you should amend your revocable trust. In addition to adjusting the assets you want your spouse to receive, you may want to name a trustee to manage the trust after you pass.
Though you may have many competing interests when going through a divorce, you should update your estate plan as soon as possible. Doing so will ensure that your will is executed the way you intend and that your financial legacy transfers to the beneficiaries of your choice.