Getting divorced? You need to update your estate plan ASAP
Your spouse is arguably the most important person in your life. They provide emotional and financial support. They help you start or raise a family. They are with you every day and have access to almost every aspect of your life.
It is natural for spouses to prioritize each other when they create their estate plans. However, the focus on your spouse in your will, health care directives and other estate documents means that divorce will have big estate implications.
As soon as either of you files for divorce, you may want to think about how to update your plan to protect yourself, dependents and your legacy.
Your ex should not have authority or receive property
With rare exceptions, people going through a divorce want to completely remove their ex from their estate plan. You need to remove them as a beneficiary in your will. You also need to remove them from your trust as the trustee or a beneficiary.
You want to take their name off of any documents intended for a medical emergency, like your advance medical directive and powers of attorney. You will typically want to choose someone whom you trust to hold authority over your finances and access to your medical records if you experience incapacitation, so replacing your ex with someone else is a smart move. You may want to add children or other close family members as the beneficiary instead of your ex.
It is also important to update beneficiary designations for insurance policies and bank accounts with transfer on death designations, as the paperwork associated with those policies and accounts will supersede estate planning documents if they contradict each other.
You may need to create better plans for your children
You may not have worried much about leaving a direct inheritance for your children before, but you need to reconsider it after a divorce.
If your ex will assume custody of the children after your death, they will have complete control over the inheritance your children receive. Putting the assets you want your children to inherit into a trust can preserve those assets until your children turn 18 and prevent your ex from using them.
Making the right changes to your estate plan when you file for divorce will protect you and loved ones.