Divorce is a tumultuous time. After all that paperwork becomes final, you then need to look at another set of documents. There are various points in your life where you need to update your estate plan, and following a divorce is one of those times.
Many people develop their wills, trusts and other estate planning documents after marriage because it is such a significant life event. People want to make sure their spouses will receive all essential benefits. However, divorcing changes those plans, and you may have a different plan in mind now for your assets. Here are the steps to take if you ever need to update an estate plan shortly after divorcing.
Revoke the previous will
In some cases, you can make amendments to a pre-existing will. However, when you divorce, you are better off starting from the beginning. Have an attorney revoke the previous will, and create a brand new one. You will need to decide whom to leave property to and who should serve as guardian of any children you have in the event you and your former spouse cannot care for the kids.
Reconsider powers of attorney
People typically grant power of attorney to designated parties to make financial and medical decisions in the event the person is unable to make those choices independently. In Colorado, power of attorney automatically becomes revoked from a spouse when divorce proceedings begin. However, you still need to grant someone else this power in case you need a loved one to make decisions on your behalf.
Make other beneficiary designations
A will only designates so much in the event of death. There are numerous other assets you will need to have a beneficiary for, including the following:
- Retirement accounts, such as 401(k)s and IRAs
- Life insurance policies
- Transfer-on-death brokerage accounts
- Pay-on-death bank accounts
You will need to request new documents from your employer, brokerage company or bank. You will need to take care of all this as soon as possible.