Going through a divorce is usually a very difficult experience. It can be tempting to avoid thinking about related aspects, however, there are important post-divorce estate planning considerations. There are several steps to take after a divorce:
Revoke your will and prepare a new one
Revoke your prior will and prepare a new one. If you made a will while you were married, you may have left everything to your spouse. You will probably want to change that now. You can prepare a new will naming different beneficiaries and alternates. You should also:
Name an executor
Name a guardian to care for young children
A key reason that many parents of young children make wills is to name a guardian to raise their children if necessary. Under most circumstances, the other parent will be the custodian of the children, however it is still important to have a back-up plan in the event that neither parent can care for the child.
Update Beneficiary Designations
If your former spouse was a beneficiary, then you may want to change this unless you have children in common. Even then you can create a trust for the children if you desire. Many assets pass outside of a will to beneficiaries named on bank or insurance paperwork. Update your beneficiary designations for:
Life insurance policies
Retirement accounts such as IRAs and 401(k)s
Pay-on-death bank accounts
Transfer-on-death brokerage accounts
To name a new person to inherit these assets, update beneficiary documents from your bank, brokerage company, or employer.
Make New Powers of Attorney
Powers of attorney are documents that give someone authority to act on your behalf. If your former spouse had a power of attorney to handle important matters on your behalf, then likely you will want to change this. You should consider having two powers of attorney: one for medical decisions and one for finances. For your estate planning needs, consult with an experienced attorney.
Juan C. Velasco, Esq. is a trusted attorney who has been serving the New Jersey area for over 25 years. If you are in need of experienced legal counsel, please contact Velasco Law Office and we will be happy to assist you.