If you are going through a divorce, you may have considered how your property will be divided when the divorce is finalized. You should also consider what you want to happen to your estate in the future and who will make decisions for you if you become incapacitated. If you are going through a divorce, it is time to update your estate plan.
Preparing to Update Your Estate Plan
Part of the divorce process is figuring out what is in your marital estate by gathering tax records, bank account information, insurance policies, credit card statements, and any documents that pertain to retirement accounts and life insurance. You will also want to use these documents when updating your estate plan.
Many people name their spouse in their wills, trusts, and accounts. If you have left your property to your husband or wife, clearly you will need to update your estate plan around the time you finalize your divorce. You may need to obtain a final copy of your divorce decree to make amendments to some accounts.
Update Your Power of Attorney
Another thing to consider is who will make decisions for you if you become incapacitated and unable to make decisions for yourself. You may have trusted your spouse to make these decisions on your behalf. Divorce can change that.
Even if you remain on good terms with your spouse after a divorce, your spouse may no longer want the responsibility of being your power of attorney. You can revoke a prior power of attorney by destroying all copies or by providing notice to the person with power of attorney (your agent) in accordance with state law.
When updating power of attorney forms, you might consider naming another person such as an adult child, close friend, or relative to be your agent--the person who can manage your healthcare decisions and finances if you are no longer able to express your personal wishes.
Selecting a power of attorney is one of the most important decisions that you will make. A person with power of attorney should be familiar with your assets and your wishes and should also be a person whom you trust.
Naming Future Guardians
Divorce can change what you envisioned for your family because you and your spouse will no longer be managing the same household. You can use an estate plan to name the person you want to take care of your children in case something happens to you. If you have children from a prior relationship or marriage, this is especially important.
If you decide to name a future guardian for your children in case something happens to you, talk to the person you have in mind to ensure that they are ready and willing to take on the responsibility. Consider naming the person that you want to be a future guardian singularly--not that person and their spouse--in case they divorce or predecease their spouse.