You probably already know that estate plans should be reexamined and altered from time to time. Most estate-planning experts say to revisit your plans every time something major happens. Few life events affect things like a divorce since it is, at its heart, primarily a financial event. If a divorce is in the offing, take a look at some issues that might need to be addressed with your estate plan.
Beware of That Interim Period
Once you realize your marriage is over, take action and meet with your estate lawyer. It can take months (or even longer) for a divorce to become final and you want to ensure things are changed as soon as possible. If you don't act, the worst could happen and your soon-to-be-ex could be left with the bulk of your assets. Look through your estate plan and prepare to be shocked at how often you've designated them to be in charge of things after you either die or become incapacitated. Don't just look at your will — take a look at the beneficiaries of your life insurance policies too.
Wills and Divorces
Wills, and divorces for that matter, are always guided by state law and states vary quite a bit in the way things happen. In some states, for example, a divorce acts to automatically make a will invalid. Whether that happens or not, speak to your estate lawyer and have your will updated to address your new needs and desires. Did you mention your ex-spouse's children in your will or trust and do you still want to leave them something? This and other difficult questions need to be addressed.
Trusts and Divorces
If you also have a revocable or irrevocable trust as part of your estate plan, attention needs to be paid. Unlike a will, trusts are not overseen by the probate court. It's common for issues to overlap between the two estate vehicles. You might, for example, leave something to your ex in both your will and your trust. With a will, some of those provisions are invalidated after a divorce but a trust stands on its own. Not only that, but any asset addressed in both a will and a trust is disposed of using the trust and not the will.
Everything changes with divorce and your estate plan deserves some care before it's too late. Speak to your estate lawyer as soon as possible during the separation period.
For more information, contact a law office like Wright Law Offices, PLLC.
Share8 December 2020
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