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Why divorce and estate planning go hand in hand

| Apr 1, 2021 | Estate Planning |

When going through a divorce, it is natural to focus on your immediate future. After all, you do need to concentrate on ending your marriage in a way that allows you to retain as many of your assets as possible. 

Despite this, you need to keep one eye on your long-term future as well. Regardless of your age, you need to be looking toward retirement and your end-of-life plans. Updating your estate plans following your divorce is an essential task.

Where do you start updating your estate plans?

You may not be able to update any of your plans until your divorce is final, so check with your attorney before you start. Once you’re ready, however, here are some things to consider:

  • Revise your assets: Once you complete your divorce, your estate will be different from what it was pre-divorce. Look at what you leave with and consider how you will re-allocate those assets between your heirs.
  • Update your beneficiaries: Your opinion about who you want to leave things may have changed. Be sure to update any designated beneficiaries named on retirement accounts as well as those named in your will.
  • Check your trustees: If you had named your spouse as a trustee on any trusts you created, you might want to replace them. If you feel the trustees were your spouse’s contacts, you might want to get your own to ensure they act in your interest.
  • Update who will speak on your behalf: You may have given your spouse power of attorney over your finances and healthcare. You may want to choose someone else now you are divorcing.

Divorce is one of several significant events that require you to revisit your estate plan. To avoid forgetting, set a reminder to review your estate plan every year. You may spot something that could prove costly if you do not update your estate plan to reflect your current situation.