5 Estate Planning Strategies to Address ASAP After a Divorce
Half of Americans die prior to writing their will, leaving the legacy of their estate in question. This is particularly common among divorced estate holders, who often forget to complete their will after finalizing dissolution. If you’ve recently divorced, don’t forget to tackle these essential estate planning strategies:
- Revoking Your Will
Your first estate planning to-do following marriage dissolution? Revoke your former will. Merely tearing up the old document is not enough, although it’s a great start. Draft a new will containing language that clearly revokes the old one.
Your former will likely left all property to your spouse—and named that person as executor. Now, you’ll need new beneficiaries and a new executor.
- Designate a Guardian For Minor Children
In addition to allowing estate holders to designate beneficiaries and executors, wills allow for guardian designation for minor children. Typically, this duty falls to the co-parent, but not all parents desire custody. If necessary, select an alternative guardian. Use your will to inform the probate judge in the event of your death while your children are still minors.
- Change Your Life Insurance and Retirement Account Beneficiary
As with your will, your beneficiary on your life insurance and retirement accounts is probably still your ex. Regardless of state law, the Employee Retirement Income Security Act mandates that beneficiaries named in plans receive funds from account administrators, even following a divorce. In other words, with no explicit change, your retirement and life insurance funds will go to your ex.
- Designate Power of Attorney
Previously, you took it for granted that your spouse would handle your finances if you became incapacitated. This is no longer your ex’s obligation, so it’s imperative that you designate power of attorney shortly after your divorce. In general, separate people should be appointed for financial and health care matters.
- Options For Your Trust
If you and your spouse established an irrevocable trust, it’s too late to change anything—your ex must remain the beneficiary. If you created a revocable trust, however, you can remove your ex as beneficiary or trustee.
Prompt estate planning will lift a great burden from your shoulders following divorce. This process may be burdensome, but it’ll help you pursue a fresh start, free from lingering worries about your estate.
Contact DiPietro Family Law Group today to learn more about the intersection between estate planning.