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3 things you need to know about estate planning after divorce

On Behalf of | Dec 4, 2023 | Estate Planning |

Are you currently going through a divorce or planning to file for a divorce soon? If so, you will likely need to update your estate plan to ensure it reflects current affairs.

Revisiting pertinent areas of your estate plan can save you from leaving undesirable beneficiaries on your accounts.

1. The impact of divorce on estate planning

After a divorce, your financial landscape undergoes a significant transformation. Begin by taking stock of your assets, which may include real estate, investments and retirement accounts. Confirm that your records are updated to reflect your holdings’ current status accurately.

Post-divorce, it’s also imperative to revisit and update the beneficiaries listed on your accounts, policies and trusts. Failing to do so might result in unintended consequences, with your ex-spouse potentially still being entitled to certain assets.

2. The need to update your will

Updating your will to clearly outline your wishes regarding any minor children’s property, finances and guardianship is crucial. Be meticulous in detailing the division of assets to avoid potential disputes among heirs.

Selecting a new executor for your updated will after divorce is a decision that requires careful consideration. This individual is responsible for ensuring your wishes are carried out faithfully. Choose someone you trust and who has the financial acumen to handle the complexities of estate administration.

3. The tax implications of divorce on your estate

Estate planning after divorce offers opportunities to optimize your tax position. Consult with financial professionals to explore potential tax benefits and deductions that may be available to you. Strategic planning can minimize the tax burden on your estate, helping ensure more assets are preserved for your intended beneficiaries.

Include guidelines in your estate plan to address ongoing financial obligations. This may include items such as alimony and child support. Stipulating how these payments should be managed can ensure the well-being of your dependents is safeguarded.

Estate planning after divorce is a meticulous process that requires attention to detail. By addressing the considerations outlined in this guide and seeking legal counsel, you can ensure that your financial legacy aligns with your current circumstances and protects the interests of your loved ones.