I want to share some estate planning tips if you have recently gone through a divorce or dissolution. I know that thinking about more legal “stuff” is probably the last thing you want to do after your divorce is final, but honestly, it should be the first. Here are four tips about what you should consider if you are recently divorced.
Tip #1
Estate planning tips when you divorce and have minor children
My estate planning tip #1 is that when you divorce, it may be wise to update the guardian and trustee of any minor child. Why? Because when you divorce and have minor children you should re-evaluate the appropriateness of the alternate guardian and trustee nominated in the existing will. For instance, if that is a relative of your former spouse, they may not ensure that the child has ample time with your family members should you die unexpectedly.
Tip #2
Estate planning tip when you divorce, and you had jointly held assets with your spouse.
As a newly divorced individual, you should obtain new deeds, titles, or registration for assets no longer jointly held. Examples include real estate, stocks and bonds, vehicles, joint bank, and brokerage accounts. This includes those designated Transfer on Death [TOD] or Payable on Death [POD]). This will make sure your former spouse is not the surviving beneficiary of these assets.
Tip #3
Estate planning tip when you divorce and your former spouse was the named primary beneficiary.
Typically a former spouse is the named primary beneficiary for life insurance policies, annuities, revocable and other trusts, and more. These designations should be updated if the Decree of Divorce or Dissolution permits such changes. Although Ohio has a Revocation Statute that deems a spouse to have predecease the policy owner, if you plan is covered through your employer under ERISA, the beneficiary designation on file will continue to control.
In summary, when you divorce, you should view it as an excellent time to review your estate plan and make necessary updates. Ohio, like most states, has laws that address some estate planning issues following a divorce. For example, Ohio law provides that if a person who executes a will reaches a settlement of property rights following a divorce, annulment, or separation, “any disposition or appointment of property made by the will to the former spouse…shall be revoked.” This largely eliminates the possibility that the former spouse will inadvertently receive benefits under the will. Still, it’s wise to take the opportunity to review your estate plan and make all the necessary updates following your divorce or dissolution.
A divorce or dissolution can be stressful, time-consuming, and complicated. You want to move on. I understand, but if you don’t take the time after your divorce to make the necessary updates to your estate plan, you might regret that decision later. Or your heirs will. Feel free to call me at 513-399-7526 or visit my website www.davidlefton.com to schedule a consultation.