Going through a divorce can be emotionally, financially, and even physically exhausting. Often, the strong emotions experienced during the divorce process make it easy to overlook the practical consequences of the divorce itself. With that in mind, we, the Owings Mills estate planning attorneys at Gershberg & Associates, LLC can offer some estate planning considerations when you go through a divorce.
Prenuptial agreements are now relatively common and having one in place should make the divorce process easier. A prenuptial agreement is a contract between two parties in contemplation of marriage that takes effect when the couple are legally married. A prenuptial agreement can cover property division upon divorce, financial responsibilities during marriage, spousal support, and the distribution of estate assets if one spouse dies. A postnuptial agreement effectively accomplishes the same thing as a prenuptial agreement; however, it is entered into after marriage.
Updating Your Estate Plan During and/or After a Divorce
Most married couples create estate plans that reflect their marital status. For instance, your spouse is likely the beneficiary of many assets and you probably hold some assets jointly. Some married couples have estate plans that are even more intertwined. You may also have appointed your spouse to important fiduciary and/or decision-making positions within your estate plan. All of that makes sense while you are married, particularly if you have children together; however, if you decide to end the marriage you should update your estate plan to reflect the change in your status as soon as possible.
Failing to update your estate plan could leave your now ex-spouse as a beneficiary in your Last Will and Testament and/or the primary beneficiary of your life insurance policy. Worst still, imagine failing to update an advance directive that appoints your spouse as your Agent for making health care decisions for you in the event your incapacity prevents you from making them yourself? Always consult with your estate planning attorney before making any changes to your estate plan to make sure such comply with the laws of the State of Maryland. The following are common updates that you will likely need to make:
- Revising your Will. Along with removing your spouse as a beneficiary under the provisions of your Will, you may also need to remove him/her as the Personal Representative of your estate and appoint someone new to the position.
- Amending a trust agreement. A trust is a very popular addition to an estate plan. If your plan includes a trust, and you appointed your spouse to be the Trustee, or Successor Trustee, of the trust, you may need to amend the trust agreement to appoint a new Trustee.
- Changing beneficiary designations. Your spouse is also likely the primary beneficiary of your life insurance policies, retirement accounts, and other financial accounts. Before changing these designations, make sure that your divorce decree does not require you to continue to maintain life insurance that names your spouse as the beneficiary as is frequently the case when minor children are involved.
- Terminating a Power of Attorney. At some point you may have executed a Power of Attorney naming your spouse as your Agent. You will want to terminate the POA as soon as possible.
- Changing an advanced directive. If you have an advance directive in place, you probably named your spouse as your Agent, giving him/her the legal authority to make health care decisions for you if you are unable to make them at some point. If this is the case, it is important to execute a new Advance Directive as soon possible.
Contact an Owings Mills Estate Planning Attorney
For more information, of if you have additional questions or concerns about updating your estate plan after divorce, contact experienced Owings Mills estate planning attorney, Richard L. Gershberg and his team at Gershberg & Associates, LLC by calling 410-654-3850 to schedule an appointment.