Should you update your estate plan after divorce?

| Nov 5, 2020 | Estate Planning

Yes!

Too many people feel that a comprehensive estate plan is something to be drafted once and then left locked up in a file somewhere safe. In fact, your estate plan should be examined and revised every few years. Certainly, the plan should be modified after any significant life event including the birth of a child or the dissolution of marriage.

Even if people remember to go through various accounts and policies to remove an ex-spouse’s information, there are things that might be forgotten in modifying an estate plan after divorce.

  1. Review your health care proxy: When developing the estate plan, you would have chosen someone to make decisions regarding health care. Many people choose their spouse to ensure their wishes are followed. After a divorce, though, it might be wise to change the proxy.
  2. Review your power of attorney: Like a health care proxy, an individual with power of attorney can make financial decisions if you become incapacitated. After a divorce, leaving your ex-spouse as power of attorney might be a poor choice.
  3. Review your will and trust: After your divorce, it is important to review your will and trust to ensure they reflect your current wishes. You might also want to remove extended family members.
  4. Draft a trust for any minor children: Many individuals consider the financial future of their minor children after a divorce. A trust is a great way to set aside money earmarked for their well-being.
  5. Revise named beneficiaries: Don’t forget to look over your life insurance plan, retirement accounts or other funds that might have your ex-spouse listed as a beneficiary.

Tying up loose ends from your divorce can take a significant amount of time. From updating insurance policies to dissolving shared social media accounts, a divorced couple might take months to fully finalize the dissolution of their marriage. Many individuals choose to work with an experienced attorney to ensure all documents are thoroughly reviewed and updated. Do not hesitate to carefully examine all aspects of your comprehensive estate plan to ensure it accurately reflects your new situation.