FAQ’s – DIVORCE AND ESTATE PLANNING FAQS AND MYTHS
“Estate planning is an important and everlasting gift you can give your family.
And setting up a smooth inheritance isn’t as hard as you might think.”
– Suze Orman
Myth: Since I am divorced, my ex-spouse will receive nothing if I die.
Fact: It is really up to chance and state law. Some beneficiary designations and asset titles are automatically revoked after a divorce if your spouse is named as the beneficiary, while others do not. For example, many retirement plans will pass to the named beneficiary, even if you are divorced from that person at your death. It is much better to be proactive and make conscious choices about your beneficiary designations, rather than leaving it to chance.
Myth: I cannot update my will or trusts because I am paying child support or alimony.
Fact: Unless you have a contractual will (which is rare), you are free to update your estate planning documents any time you want after a divorce is finalized. You may need to factor in ensuring that any alimony or child support claims that survive your death are paid, but it would be incredibly rare and unusual to required an inheritance be left to an ex-spouse in your will or trust. If you are paying child support or alimony, let us know so we can factor it into your plan.
Myth: Since I am divorced, my ex-spouse no longer has any authority under a financial or medical power of attorney document.
Fact: This may be true or it may not. It really depends on state law and the terms of your power of attorney documents. Additionally, there’s always a risk that an unscrupulous ex-spouse may conveniently omit that the divorce has nullified a power of attorney and attempt to use the document anyway.
The better practice is to revoke your old power of attorney documents and create new ones to avoid any ambiguity. Then, let your hospital, physicians’ offices, banks, or anyone else who may have a copy of your old powers of attorney on file know that you revoked the old one naming your now ex-spouse. If necessary, provide them with a new copy naming your new agents.
Frequently Asked Questions:
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