In many ways, divorce is an overhaul of your entire life, especially your financial life. You must examine almost every aspect of your finances and figure out how things will look post-divorce, all while dealing with the onslaught of emotions that come with divorce.
It is natural that with all this upheaval, you might overlook the impact on your estate plan. This can be a bigger problem than you might initially think, but forgetting to update a will that leaves everything to your now ex-spouse can cause major problems down the road.
Identify all your estate planning documents
Once your divorce is underway, make a list of all your estate planning documents that will need to be updated. Remember that this can include more than just a will.
You may have accounts, trusts or power of attorney documents that list your ex-spouse as a beneficiary or designate them to take care of you in certain situations.
While you certainly do not need to update these documents, most divorcing Virginia couples find it easier to remove their ex-spouses name from estate planning documents, even if the post-marriage relationship remains amicable.
You might not be able to update until after your divorce
Many, if not most, of these tasks you will not be able to do until your divorce is finalized. You typically need to have a final divorce decree to update the documents.
Still, you can and should start preparing for this before your divorce is final. This will not only make the process go faster but will prevent problems if something happens to you before you get a chance to update everything.
Incorporating terms into a divorce agreement
You can potentially include some of the estate planning terms into your divorce agreement. For example, your agreement can include language stating that you and your spouse agree to remove each other’s names from your respective life insurance policies.
However, you must still update the policy yourself to remove your ex-spouse’s name. Your divorce agreement terms will have no effect if their name is still on the policy at the time of your death.
Your divorce attorney can help you with all aspects of your divorce, making sure you do not forget any essential tasks.