A separation or divorce can drastically affect one’s personal life. But it could also drastically affect an one’s finances, estate plan and business. Thinking about how a divorce would impact your estate or business is something that very few want to consider in their planning. But if you’re planning ahead, shouldn’t you consider all possibilities to make sure you’re protected?
After the divorce is finalized and you have finished dividing all the property, there are still a few things you need to deal with that can have serious consequences if left untouched.
Considerations Regarding Your Planning:
- Update Your Will. Chances are that your spouse played a key role in your current will or estate plan. You will probably want to update your Will or Trust documents where spouse was named and reevaluate the distribution of your assets.
- Change Your Power of Attorney(s). If your former spouse was your power of attorney, you typically will want to revoke them as agent and assign someone else for this position. The power of attorney is in charge of your health care and or finances if you are unable to make decisions for yourself. You will probably want someone besides your ex to make these important decisions.
- Minor Children & Guardianship. You may need to set up a trust if you have minor children with your former spouse. If something were to happen to you and you left your assets to your children while they are under the age of 18, the assets could end up in the hands of your former spouse. By setting up a trust, you select who handles their money and avoid these issues.
- Update Beneficiary Designations. A Will or Trust doesn’t control everything so make sure you have carefully reviewed your beneficiary designations on your investments or how certain accounts are titled to ensure that they are updated and spouse is removed where proper.