Going through a divorce is such a tumultuous process that many people neglect to amend their estate plan in keeping with their new marital status. This can be a crucial mistake because although we generally assume that this task is not urgent — you never know. Life is unpredictable and no one can foresee when an accident or health event may change everything, removing your opportunity to alter past decisions by updating pivotal documents. It is a good idea, during divorce negotiations, to get in touch with a highly skilled estate planning attorney who will help you make the changes necessary to accommodate your future lifestyle.
More people than you might expect forget to contact their estate planning attorney as they struggle through divorce and end up leaving their spouse a large portion of their assets when they pass away or allowing their former partner to make life and death decisions for them if they become incapacitated.
Preliminary Consultation with Your Estate Planning Attorney Is Invaluable
Having an open conversation that helps you understand what changes will have to be made in your estate plan will keep you from being overwhelmed later. Having a supportive professional to assist you with completing all necessary tasks will ease your mind.
Though changing beneficiary designations on various official documents will be necessary, in Florida, as in most states, you will not be able to alter such documents until your divorce becomes final. When you meet with an estate planning attorney as knowledgeable as Spiro J. Verras of Verras Law, he will make sure you comply with all up-to-date statutes regarding when your can legally change beneficiary designations on your life insurance policies, retirement accounts or plans (e.g 401k), and pensions.
Updating Your Will and/or Living Trust
Bearing in mind that if you fail to update your will or trust your ex-spouse may inherit the bulk of your assets, and then perhaps pass them on to a new spouse if she/he remarries, you will almost certainly want to change your primary beneficiary. If you die while your offspring are minors, unless your former spouse is deemed unfit, he/she will be your children’s guardian.You do, however, have an equal voice in naming a guardian if both of you die young.
When you are making your will current, your lawyer will explain the nuances involved in disinheriting a spouse in Florida. For one thing, you cannot disinherit your spouse completely before the divorce is final unless you have his/her permission through a pre-nuptial or post-nuptial agreement. If you do take that action, your spouse can legally contest your will, causing the probate process to be significantly delayed, leaving your other beneficiaries without the funds you intended them to have. For this reason, in most cases, your attorney will recommend leaving a minimal amount to your spouse until the divorce papers are finalized.
Advantages of Establishing a Trust for Your Children and Other Beneficiaries
If you designate your children as beneficiaries and you die before they reach the age of 18, a guardian must be named to manage their funds until they are old enough to inherit the full amount. It is important to recognize that if you don’t name such a person, the court may appoint your ex-spouse as their guardian, a decision you may fervently oppose.
While some people appoint another guardian, such as a sibling, parent or best friend, in whom they have total trust,to take care of their children’s finances, others are more comfortable putting their children’s inheritance into a trust. The trusted person can still be named as trustee, but will now be legally liable for any misuse of your assets. The trust will protect your assets from irresponsible spending, creditors, predators, and even from your ex-spouse.
Documents Dealing with Incapacity
During marriage, most people planning their estates automatically designate their spouses as their go-to person for health and financial matters should they become incapacitated. This decision almost always has to be reconsidered when they divorce. If you are about to divorce, your attorney will make certain that you update the following essential documents regarding who will be charged with dealing with critical matters if you become unable to do so. This will mean updating your health care proxy and power of attorney so that in the event you become incapacitated your ex-spouse will not be able to decide:
- Whether you will have medical or hospital care
- Whether you will have surgery
- Whether you will live in a nursing home
- Whether your estate should buy or sell real estate or investments
- Whether your financial accounts should be closed
- Whether you should apply for government benefits
Although a small percentage of divorced parties remain close friends, it is likely that you are dismayed at the thought of your ex-spouse retaining such control of your financial and healthcare matters and even, in some cases, over your life and death.
Unlike Divorce, Estate Planning Is an Ongoing Process
A wise estate planning attorney will always remind you that you will have to make changes to your estate plan throughout your lifetime. Divorce will not be the only major change in circumstances you confront. There may be a new business, the purchase of another home, a serious illness, a remarriage, a new baby — any one of which will require revisiting your estate plan to make sure its current.