Divorce can take a toll on your mental, emotional and physical health. However, it is critical that you make financial health a priority after your divorce. Updating your estate plan is one of the biggest steps you can take toward a more secure financial future for both you and your family.
An estate and trust plan allows you to determine who will receive your assets when you can no longer make financial decisions. You may have initially established your estate plan with your previous spouse and appointed them to take over your estate in the event you pass away or are unable to manage your finances. However, since your situation has changed, your estate plan must as well. Without updating your estate plan post-divorce, the assets you worked hard for may be given to people you no longer associate with. Estate planning is the best way to ensure that the things and money you own go to the people you want.
If you have recently gotten divorced, now is the time to revisit and update your estate plan. When in doubt, a CERTIFIED FINANCIAL PLANNER™ professional can help you determine what information in your will and trust needs to be reviewed. They can also help you establish a financial plan that supports, protects and maintains your wealth, even after your household income has changed.
3 important estate planning tips to keep in mind after a divorce
Several aspects of your life can change after a divorce. It is therefore critical that you review documents in your estate plan so that they reflect your priorities and desires in the present. For instance, you may want to rename your beneficiaries and powers of attorney, and you may want to make changes to your life insurance policy.
The following tips can help you feel more secure while reviewing your estate plan after your divorce:
- Determine what you are owed — After a divorce, you may be entitled to half of your spouse’s retirement fund or other accounts. A financial advisor can help you organize the money you are owed and incorporate that money into your financial plan. This transfer of assets post-divorce needs to be reflected in your estate plan
- Understand your financial obligations — If your spouse owed money in car payments, mortgage payments or student loans before your divorce, and your name is attached to those loans, you may need to assume responsibility for half of that debt. A financial advisor can help you understand your legal and financial obligations during and after your divorce.
- Retitle your assets — You may have shared bank accounts, investments, property and insurance policies with your spouse. After your divorce, these titles are divided in court. You need your estate plan to reflect the correct ownership of assets and organize all the assets in your name. You also need to update how you would like those assets to be distributed in the event you pass away.
Talk to a ProVise CFP® professional about estate planning after divorce
Planning your professional and personal finances after a divorce can be overwhelming, but you do not have to do it alone. At ProVise Management Group, our CERTIFIED FINANCIAL PLANNER™ professionals can get to know you and your current financial circumstances, goals, risk tolerance and personal values to help you develop a plan that works for you. We can also create a written plan for you at a fiduciary standard of care. All our written plans come with an unconditional money-back guarantee. If you are unhappy with your written plan, you can return it to us, and we will refund 100% of the fee paid.
Are you ready to talk to a professional about updating your estate plan post-divorce? Contact ProVise today to schedule a complimentary consultation.