Estate planning as a part of divorce
As part of getting divorced, Georgia residents should prioritize reviewing and updating estate plans to protect themselves and their heirs.
From which spouse gets the house to which parent will get the kids on which holidays, the topics that Georgia spouses must face when getting divorce seem never-ending. Once these decisions are finally made, people may well feel emotionally spent and ready to be done and just move on. However, stopping here could still result in risk to their remaining assets or to their children’s inheritances down the road.
The bottom line is that estate planning is a part of divorce-at least that is how people should think about it. As recommended by 360 Degrees of Financial Literacy, people should review and update their estate plans after any major life change. Divorce is indeed a very major life change.
What estate plan documents should I review?
Certainly any trust or will that exists should be revised as many things in these documents will naturally have changed. Assets previously owned by both spouses may have been sold or are now owned by only one spouse. If the parents of one spouse were originally named as the guardians for the children should both parents die, that may or may not be the preferred choice after a divorce. Additionally, a person who once agreed to act as an executor or trustee out of allegiance to the couple as a unit may feel uneasy about doing so for just one of the parties.
Are there other things that require attention?
Fidelity Investments indicates that wills and trusts are not exhaustive estate planning tools. Assets from retirement accounts or life insurance policies are not part of these tools and therefore the beneficiaries of such accounts must be updated separately from any changes made to a will or a trust.
It is common for married people to name their spouses as the beneficiaries for these things. If this is not changed after a divorce, the original designation may remain in effect and an ex-spouse could be the recipient of funds a person would have rather seen go to the children.
There is one word of caution here. Before changing beneficiaries, people should check with their attorneys to make sure that their divorce decrees do not require keeping an ex-spouse as the beneficiary on a particular policy or plan.
In addition, newly divorced persons should give serious thought as to who they would wish to take control of their finances or health care decisions if they should ever be unable to do so.
How can I get help with my divorce-related estate planning?
The best thing for Georgia spouses to do is to talk candidly with their attorneys during their divorces. Getting the input of an experienced lawyer can help people make sure they do not miss important steps in their divorce process.