February 21, 2022

Even if the process is amicable, divorce can be one of life’s most stressful events. With so many major changes taking place, it’s easy to forget to update your estate plan—or simply put it off until it’s too late. After all, dealing with yet another lawyer is probably the last thing you want to do.

However, neglecting to update your estate plan for divorce can have potentially tragic consequences. And you shouldn’t wait until the divorce is final to rework your plan—you should update it as soon as you realize the split is inevitable.

Here’s why: Your marriage is legally still in full effect until your divorce is final, so if you die or become incapacitated while your divorce is ongoing and haven’t changed your estate plan, your soon-to-be ex-spouse could wind up with control over your life and assets. You need to take action as soon as possible to ensure avoidance of these kinds of problems

However, keep in mind that some states have laws that limit your ability to change your estate plan once your divorce is filed, so you may want to consider making some or all of the following changes to your estate plan as soon as divorce is on the horizon and before you’ve filed. As your Personal Family Lawyer®, we can support you to ensure your estate plan is properly updated to reflect the latest changes in your life situation, family dynamics, and asset profile. Contact us as soon as you know divorce is coming, or right away if you’ve already begun the divorce process. 

1. Change Your Power Of Attorney Documents

Unless you want the person you are removing from your life to make all of your legal, financial, and medical decisions in the event of your incapacity, you need to update your power of attorney documents as soon as divorce is inevitable. All adults over age 18 should have both a durable financial power of attorney and a medical power of attorney in place.

A durable financial power of attorney allows you to grant an individual of your choice the legal authority to make financial and legal decisions on your behalf should you become unable to make such decisions yourself. Similarly, a power of attorney for health care (which may be called something different in your State) grants someone the legal authority to make your healthcare decisions in the event of your incapacity.

Without these documents in place, your spouse may have priority to make financial and legal decisions for you at least until the divorce is finalized. And since most people typically name their spouse as their decision maker in these documents, you need to take action even before you begin the divorce process and grant this authority to someone else, especially if things are anything less than amicable between the two of you. If something were to happen to you in the midst of the divorce proceedings and changes are not made, you could be in serious peril and family conflict could be devastating. Furthermore, while some states have laws that would result in your soon-to-be ex-spouse being excluded from your existing plans once divorce is finalized, this may not take effect until that actually occurs, and can be modified by a court order, or terms of your estate planning documents, or other contract relating to the division of the marital estate.

Once divorce is a sure thing, don’t wait—immediately contact us, your Personal Family Lawyer® to get these documents created or reviewed and potentially changed. And unless your attorney focuses their practice on estate planning, we recommend you don’t rely on your divorce lawyer to update these documents for you. There are just far too many important details in these documents that can be overlooked by a lawyer using a standard form, rather than the custom documents we will prepare for you.

2. Change Your Beneficiary Designations

As soon as you know you are getting divorced, you should update the beneficiary designations for assets that do not pass through a will or trust, such as life insurance policies and retirement plans. Failing to update your beneficiaries can lead to serious trouble down the road, and unfortunately, we see this happen all the time. Please note however that certain laws prohibit the removal of the spouse as a beneficiary of certain kinds of accounts without their consent. You should discuss this with us or other qualified counsel so that you understand your rights and obligations based on your specific circumstances.

And since there may end up being restrictions on changing beneficiary designations after a divorce is filed, the timing of your beneficiary change is particularly critical.

Another nightmare scenario can occur by not having beneficiary designations changed after divorce. If something happens to you, even if your ex-spouse is no longer a beneficiary (which would be dependent on state law, and can possibly be modified by a court order, or terms of your estate planning documents, or other contract relating to the division of the marital estate), if you don’t have beneficiary’s designated it could result in assets being paid to your probate estate, which means forcing assets through Court after your death. It could also mean seriously adverse tax consequences!

If your divorce is already filed, meet with us your Personal Family Lawyer® to see if changing beneficiaries is legal in our state, to discuss the timing of those changes—and whether it’s in your best interest. And if naming new beneficiaries is not an option for you now, once the divorce is finalized it should be your number-one priority. In fact, put it on your to-do list right now!

3. Create a New Will

You should create a new will as soon as you decide to get divorced, although you will need legal counsel regarding the timing of this once you have filed anything with the Court. And because most married couples name each other as their personal representative or executor and the primary beneficiary of their estate, it’s important to make sure you understand who is named to serve in the event of a divorce and that the person you want to serve is properly named in your legal documents

When creating a new will, rethink how you want your assets divided upon your death. This most likely means naming new beneficiaries for any assets that you’d previously left to your future ex and his or her family. Keep in mind, some states have laws that entitle your surviving spouse to a certain percentage of the estate upon your death, regardless of what your will says. So if you die before the divorce is final, you probably won’t be able to entirely disinherit your surviving spouse through the new will.

That said, it’s almost certain you wouldn’t want him or her to get everything. In light of this, you should create your new will as soon as you realize divorce is inevitable to ensure the proper individuals inherit the remaining percentage of your estate should you pass away while your divorce is still ongoing.

And should you choose not to create a new will during the divorce process, don’t assume that your old will is automatically revoked once the divorce is final. State laws vary widely in regards to how divorce affects a will. In some states, your will is revoked by default upon divorce. In others, the will is not revoked, but any provisions regarding the ex are revoked (although in some states this may be able to be modified by the will itself or a court order) unless it’s officially revoked, your entire will—including all provisions benefiting your ex—remain valid even after the divorce is final. All that being stated, the foregoing may not reflect what happens in your state, and the devil is in the details.

Given the uncertain legal landscape, meet with us your Personal Family Lawyer®  as soon as you know divorce is coming. We can advise you on our state’s laws and how to best navigate them when creating your new will—whether you do so before or after your divorce is final.

4. Amend Your Existing Trust Or Create A New One

If you have a revocable living trust, you’ll want to update it too. Like wills, the laws governing if, when, and how you can change a trust during a divorce can vary, so you should consult us as soon as possible if you are considering divorce. In addition to reconsidering what assets your soon-to-be-ex spouse should receive through the trust, you’ll probably want to replace him or her as successor trustee, if they are so designated. Furthermore, even if the spousal provisions in the trust are deemed revoked once you are divorced, the trust may well need to be amended to some extent to take into account your new circumstances.

And if you don’t have a trust in place, you should seriously consider creating one, especially if you have minor children. Trusts provide an array of benefits that are unavailable with a will, and they’re particularly well-suited for blended families. Given the likelihood that both you and your spouse will eventually get remarried—and perhaps have more children—trusts are an invaluable way to protect and manage the assets you want your children to inherit.

By using a trust, for example, should you die or become incapacitated while your kids are minors, you can name someone of your choosing to serve as successor trustee to manage their money until they reach adulthood, making it impossible for your ex to meddle with their inheritance.

Given the enhanced protection and control that a trust can provide compared with a will, you should at least discuss creating a trust with us, your Personal Family Lawyer® before ruling out the option.

5. Revisit Your Estate Plan Once Your Divorce is Final
During the divorce process, your primary objective is limiting your soon-to-be ex’s control over your life and assets should you die or become incapacitated before divorce is final. For this reason, the individuals to whom you grant power of attorney or name as trustee or add to your estate plan in any other way while the divorce is ongoing may just be temporary.

Once the divorce is final and your marital property has been divided up, you should revisit all of your estate planning documents and update them accordingly based on your new asset profile and living situation. From there, your plan should continuously evolve along with your life circumstances, particularly following major life events, such as getting remarried, having additional children, or when family members pass away.

Get Started Right Away

Although it may be tempting to put off changing your estate plan when you are going through a divorce, especially if the process has been contentious, you can’t afford to wait. Meet with us to review your estate plan immediately upon realizing that divorce is unavoidable, and then schedule a follow-up visit once your divorce is final.

If you delay updating your estate plan, even just for a few days during your divorce, you could be in a situation where it is legally impossible or impractical to change certain parts of your plan, so act now. And if you’ve yet to create any estate plan at all, an impending divorce is the perfect time to finally take care of this crucial responsibility. Contact us today to learn more.

This article is a service of a Personal Family Lawyer®. We do not just draft documents; we ensure you make informed and empowered decisions about life and death, for yourself and the people you love. That’s why we offer a Family Wealth Planning Session™, during which you will get more financially organized than you’ve ever been before and make all the best choices for the people you love. You can begin by calling our office today to schedule a Family Wealth Planning Session and mention this article to find out how to get this $750 session at no charge.