Individuals thinking about getting a divorce, or currently going through the process, often update their estate plans, including their wills, powers of attorney, health care proxies, trusts, and other documentation. They do this to ensure that their affairs are in order and that all of the estate planning documents accurately reflect their wishes. Learn more about estate planning after divorce and discover how a Georgia divorce attorney can assist in this area by contacting The Millard Law Firm at (678) 319-9500.
Estate Planning After Divorce Explained
Estate planning involves performing several tasks to manage a person’s financial, personal, and legal affairs, such as bequeathing assets to beneficiaries, settling debts and estate taxes, or appointing guardians to look after any dependents, in preparation for their death or incapacitation. One of the most common estate planning tools is a Last Will and Testament, which the State of Georgia defines as a legal document declaring how people wish to divide their property after they die. For many individuals, estate planning also includes establishing trusts and designating powers of attorney.
The divorce process ends with the issuing of a decree that, according to the United States Government, formally dissolves a marriage and proves this event took place. Since many people choose to include their spouses in their estate plans, they may wish to review these documents after divorce, particularly if the former couple ended their relationship on bad terms.
What Effect Does Divorce Have on an Estate Plan?
Divorce impacts both a person’s daily life and their future estate plan. Individuals who drafted a will during their marriage likely left their property, money, and other possessions to their spouse. They may also have named their spouse to manage their finances and make crucial medical decisions on their behalf if something unfortunate happens to them. Unless they still want their ex-spouse to have these assets and responsibilities, it is key to revise this documentation.
Those who have yet to plan their estates may have their former partners listed as beneficiaries on their retirement accounts or life insurance policies. If they decide not to change these designations, that person receives the money once the individual passes away.
What Are the Three Main Priorities You Want To Ensure With Your Estate Plan?
Divorces can prevent family or legal disputes and ensure the efficient handling of their estates after they die or become incapacitated by prioritizing these three areas of their estate plans:
- Making sure another person can make crucial decisions on behalf of the individual when they can no longer do so themselves
- Ensuring that it is clear who the intended beneficiaries are
- Establishing the exact manner in which the person wishes to distribute their property
Gain more information about estate planning after divorce and see how a seasoned Georgia family lawyer can help divorcees explore their legal options by scheduling a consultation with The Millard Law Firm.
How Do I Plan My Future After a Divorce?
After a divorce, make these estate plan adjustments:
- Revoke the current will. A person may wish to either update their existing will to reflect their new circumstances after a divorce or create one. Examples of possible adjustments include naming another person to act as the executor and changing the property division terms.
- Revise health care proxies. Depending on the relationship between the spouses after the divorce, a person may wish to appoint someone other than their former partner to make crucial health care decisions on their behalf.
- Adjust powers of attorney and beneficiaries. Consider adjusting the named beneficiaries in an established trust, and any beneficiary designations on life insurance policies and pay-on-death or retirement accounts, if you no longer want your ex-spouse to receive your money or assets. Also, think about reviewing any powers of attorney to avoid giving that person critical responsibilities regarding your affairs.
- Establish a trust. Creating a trust following a divorce can be useful for managing child support and alimony payments, in addition to distributing funds to beneficiaries. If someone wants to prevent their former spouse from handling the assets they wish to transfer to their children upon their death, establishing a trust enables them to appoint another person to do this instead.
What Are the Most Common Estate Planning Mistakes?
The following are frequent estate planning errors to avoid:
- Lack of an estate plan: For example, not having a valid trust or will means the deceased person’s loved ones have no guidance regarding the managing of the decedent’s affairs. This can cause confusion and a lack of certainty concerning the deceased individual’s wishes, and delays pertaining to property division.
- No named secondary beneficiaries: Also known as contingent beneficiaries, these people or entities receive assets within a trust or will if the main beneficiary dies before they do. Naming, preferably, two or more secondary beneficiaries helps avoid the situation in which the estate reacquires the asset, meaning a time-consuming and costly legal battle is necessary for the deceased person’s loved ones to obtain it.
- Wrong individuals appointed to estate planning roles: Sometimes, the decedent names an unsuitable person as an executor of their estate, leading to poor management of their affairs. Worth remembering is that it is unnecessary to name certain individuals, such as key family members, to perform these vital roles; instead, consider other people for these posts who preferably have relevant experience. A financial advisor or business attorney might be a wiser choice for financial power of attorney than a dear friend with limited asset management skills.
- Not regularly updating the estate plan: Effective estate planning involves keeping all of the estate plan’s documents updated as a person’s life changes. Such developments include divorce, marriage, a home purchase, new business ventures, the death of a guardian or beneficiary, and the birth of a child. Timely updates an facilitate the correct handling of a person’s affairs in line with current circumstances.
Contact a Georgia Estate Planning Attorney Today
Divorce is often a challenging time for those involved, but effective estate planning can help people move forward with their lives after the marriage ends. The recommended approach is to review all estate planning documents periodically or when a significant life event occurs, such as marriage or divorce, the death of a family member, or having a child. Consider visiting with a Georgia family law attorney from The Millard Law Firm to learn more about estate planning after divorce and to gain assistance with divorce-related legal issues by calling (678) 319-9500.