If you’ve just gone through a divorce, estate planning may be the last thing on your mind. You may have spent significant time handling your divorce case and may not want to jump into another legal matter. However, divorce is a significant life change. The outcome of your divorce will affect the configuration of your family, taxes, and assets. Here are a few of the things you may want to consider for post-divorce estate planning.
1. Last Will and Testament
A last will and testament is the foundational legal document for many people’s estate plans. In your will, you choose an executor, also called a personal representative, of your estate. You can also choose who will act as your child or children’s guardian if you pass away and how your property will be distributed upon your death.
Many married couples leave all of their property and assets to each other in their wills. You may have named your former spouse as your personal representative. After your divorce, you should work with an attorney to prepare a new will that names a new personal representative. If you’d like to leave your assets to your children, who may be minors at your death, you should name an adult to manage their inheritance for them until they become legal adults.
2. Beneficiary Designations
After your divorce, it’s crucial that you review your life insurance policies, 401(k), IRA, annuities, and any other retirement or investment accounts. Many people forget to change the beneficiary designation of these accounts after their divorces. These are valuable assets that may be worth hundreds of thousands of dollars or more. Divorce likely will not automatically revoke a beneficiary designation, potentially giving your ex-spouse your assets after you pass away. Similarly, ensure that your life insurance policy or policy beneficiaries have updated beneficiaries.
3. A Living Trust
Many estate plans include a revocable living trust. A trust allows your beneficiaries to avoid the probate process. If you and your spouse created a joint trust and you are both trustees, the trust may have been divided in your divorce. In that case, after the divorce, you should create a new revocable living trust that reflects your current post-divorce assets. You can name a successor trustee and ensure you appoint beneficiaries other than your ex-spouse. If you’ve named your children as your beneficiaries, naming a new successor trustee will prohibit your ex-spouse from having access to their assets.
4. Powers of Attorney
Most married couples name their spouses as their financial power of attorneys and their health care agents. After your divorce, you’ll need to change these designations. A durable financial power of attorney allows an agent you designate to make financial decisions for you and complete transactions if you can no longer manage your own affairs. It’s best to revoke your previous power of attorney and execute a new one with the help of an attorney after your divorce.
You should also notify your financial institutions. The same principle applies to advanced healthcare directives. Ensure your directive includes a healthcare agent you trust other than your former spouse. You should also provide your doctors with copies of your new advanced healthcare directive.
Questions About Post-Divorce Estate Planning in Pittsburgh? We Can Help
If you have questions about changes you may need to make to your estate plan after your divorce, don’t hesitate to contact Jones, Gregg, Creehan & Gerace LLP. Our experienced Pittsburgh estate planning attorneys can help answer your questions, review your estate plan, and work with you to develop a comprehensive estate plan that meets your goals effectively.