The divorce process can be very stressful, filled with many unknowns. After the divorce, time to decompress may be needed. However, before letting your foot off the gas pedal, consider the importance of consulting with an estate planning attorney to review your estate plan and divorce obligations.
Here are some items to consider when it comes to estate planning after divorce.
What You Should Know About Estate Planning After Divorce
1. Compliance with the Divorce Obligations
It is important that your estate planning attorney understands your divorce obligations, as some will impact estate planning. For example, divorce obligations may require you to designate an asset to a specific individual, such as naming a former spouse as beneficiary of a specific amount of life insurance proceeds. Divorce obligations may also mandate the division of specific assets, such as retirement or investment accounts, and may include survivor benefits for your former spouse as well.
2. Understanding Your Estate
An estate planning attorney can help you obtain an understanding of how assets, debts, divorce obligations, and tax obligations are to be handled in the event of death. For example, an asset may pass directly to a beneficiary, or it may pass through a Will or intestacy. Tax returns may need to be prepared and filed. Taxes may be owed. Divorce obligations may need to be satisfied. Debts may need to be paid. Obtaining an awareness of what may be involved in the event of your death can help you determine how to best prepare your estate plan to satisfy your obligations and not leave your loved ones with a mess of an estate.
3. Creation or Revision of a Last Will and Testament
With the help of an estate planning attorney, you can create or revise your Will as needed to reflect your situation. For example, if you have minor children, you can discuss with your attorney the naming of a Guardian in your Will, as your former spouse may predecease you or for whatever reason may be unable to care for minor children upon your death. Naming beneficiaries and appointing an Executor to handle your estate are important paragraphs in a Will. The creation of testamentary trusts may be considered as well.
4. Drafting Power of Attorney and Living Will Documents
The Power of Attorney and Living Will (Advanced Health Care Directive) documents identify specific powers and conditions for appointed individuals to act on your behalf while you are alive. An estate planning attorney can discuss with you all the options you have regarding the drafting of these documents.
5. Considering Other Documents
Depending on your situation, your estate planning attorney may suggest other estate planning documents. These may include Special Needs Trusts, Living Trusts, and Funeral and Burial Instructions. Every situation is unique, so it is important that your attorney has the necessary information in order to have a productive discussion with you about your estate plan.