It is important to update your estate plan when your life changes. One major change is divorce. A divorce not only changes your personal life but can also have an impact on your assets and estate plan. As part of moving forward, consider several tips below on updating your estate plan after your divorce:
Review How Assets Are Titled
The divorce decree may say that the vacation home goes to you but without a deed to formalize the transfer, your ex-spouse still owns the property.
Also, mortgage obligations and property deeds are two different things. You may have signed a deed transferring real property to your ex-spouse, but he or she may need to refinance in order to remove you from the mortgage. You do not want to have your name on debt for property that was awarded to your former spouse so make correcting the discrepancy a priority.
If there was a family business, work may be needed to formalize the ownership after the divorce. The LLC operating agreement may need to be revised or stock may need to be transferred.
For financial accounts, it is typically best to close old joint accounts and open new single accounts after the divorce. Joint credit cards should also be closed and replaced with credit cards in your individual name.
Update Your Beneficiaries
After the divorce is finalized, review the beneficiary designations for life insurance policies and retirement accounts. Unless required under the divorce decree, you do not want to leave an insurance policy payable to your former spouse.
An estate planning attorney can assist you with all of the above and also update your trust and last will and testament. It is also important to update your durable power of attorney and designation of healthcare surrogate after a divorce.