Divorce is a life-altering event that brings about significant changes in various aspects of your life. While the emotional and financial implications of divorce are obvious, it’s easy to overlook the impact a divorce can have on your estate plan.
Are you unsure about the importance of updating your estate plan during this transitional phase? Read on to learn why you should update your estate plan after a divorce.
Revoking outdated beneficiary designations
Many individuals name their spouse as the primary beneficiary in their wills, retirement accounts, life insurance policies and other financial instruments. If you’re one of these people, it is crucial to revoke and update these outdated designations to reflect your new circumstances. Failing to do so may result in your former spouse receiving assets you intended for others or cause unnecessary legal battles among your heirs.
Reconsidering guardianship for minors
If you have children, revisiting and reconsidering your choice of guardianship is paramount after a divorce. During the marriage, couples commonly designate each other as the primary guardian for their children in case of their untimely passing.
However, after divorce, this arrangement may no longer be suitable if they are not the parent of the particular child. Therefore, you should carefully assess your children’s best interests and select a willing, capable guardian that aligns with your values and parenting philosophies.
Evaluating a power of attorney and healthcare directives
Another vital aspect of your estate plan is the designation of a power of attorney and healthcare proxy. If you become incapacitated, these individuals are entrusted with making financial and medical decisions on your behalf.
After a divorce, it is essential to reevaluate and update these designations to help ensure that the appointed individuals are still the most suitable and trustworthy choices. Failing to make these adjustments may result in your ex-spouse having control over critical aspects of your life.
Updating your estate plan after a divorce is essential to help protect your assets, fulfill your wishes and provide for your loved ones.