3 Reasons You Need To Update Your Estate Planning After A Divorce
- Posted on: Mar 19 2020
At Palmer & Slay we encourage all of our estate planning clients to update their estate plans every few years. Most of the time, we make very few changes when a plan is updated, but there are three things that can trigger a major overhaul — the addition or loss of family members, the buying and selling of assets, and changes to the law. When someone gets divorced, all three of these factors converge, often necessitating major changes.
The Addition or Loss of Family Members
Divorce means cutting legal ties with at least one family member. It is important to update your estate plan to reflect this new reality.
One of the most important updates to make is to your living will and health care proxy documents. You probably do not want your ex to be responsible for making healthcare decisions on your behalf if you become incapacitated. You should also check in with your ex to make sure they have changed their advance directive so you are not given decision making powers should they become incapacitated.
In a similar vein, if your ex is named as the executor of your estate, you probably want to change that too. Few people would be comfortable asking their ex to administer their estate.
Sometimes, you lose more than your spouse post-divorce. Under Mississippi law, if your ex had children from a previous relationship that you did not adopt, you are legally no longer a part of their family post-divorce. This is true legally even if it is not true emotionally. If you want to include these people in your estate plan, you will need to explicitly spell out your wishes.
Changes To Assets
After your assets are divided up in a divorce, it is important to update your estate plan so that things you no longer own are not mentioned in your estate plan.
When an estate is probated and listed assets are missing it can cause problems. Sometimes it is easy to figure out that the asset was lost in the divorce, but other times it can lead to litigation by the person or organization that is named as the intended beneficiary of a missing asset.
Most of the time when we are talking about changes to the law that trigger changes to an estate plan the law in question is federal tax law. It is always changing, which means estate plans need to change to take full advantage of it. In the divorce context, the law we are talking about is more personal. In Mississippi, a divorce decree is like a mini law that governs the lives of the couple that is splitting up.
Estate plans should be updated so they work in harmony with the divorce decree. When an estate plan is not updated, the divorce decree still governs.
Preserving Your Wealth, Protecting Your Loved Ones
Working with an experienced estate planning attorney to update your estate plan post-divorce should be at the top of your newly-single to-do list.
While it may be tempting to ask your divorce attorney to take a look at your estate plan, we recommend working with a firm like ours that focuses on estate planning. You wouldn’t ask your family doctor to perform knee surgery, so why would you ask your family law attorney to take an in-depth look at your estate plan?
Posted in: Estate Planning