Your estate plan helps guarantee the financial stability of your loved ones if anything happens to you. It is quite common for people to make their spouse their main beneficiary in their estate plan and possibly to grant their spouse certain forms of authority as well.
When you decide to file for divorce, that decision will impact many different aspects of your life. Your estate plan will require your review and likely a thorough update. What documents in your estate plan may need to change after your divorce?
1. Your testamentary documents
You may have a will, or perhaps you created a trust to transfer assets to the next generation. Any document that distributes assets to others will require your review so that you can remove your spouse as a beneficiary.
Whether they will receive access to certain property held in a trust or control over assets from a will, removing them as the beneficiary will be an important step once you decide to divorce. You may even want to create a trust for any inheritance minor children may receive to ensure your spouse won’t gain control over those resources if you die.
2. Your life insurance policy
You may have invested in a sizable term life policy so that the people who depend on you will have financial support even after your death. Unlike other assets, you can’t change the beneficiary for your life insurance by adjusting your will.
You will need to update the paperwork filed with the insurance company, as your official beneficiary designation carries more authority than your will does if there is a conflict between the documents.
3. Your living will
Advance directives, such as a living will, and powers of attorney help protect you from hardship after a medical emergency. However, you may have granted authority to your spouse in those documents, removing someone who may no longer have your best interest at heart from the role of making medical decisions or handling your finances will be important for your protection. You want to name someone that you can trust to take over that position of authority.
Properly updating your estate planning documents when you decide to divorce will be an important step for your protection and the security of the other people that you love.