8 Estate Planning Tips You Need to Consider After a Divorce
Aside from the obvious immediate hurdles, a divorce can create estate planning issues as well.. It can be helpful if you and your attorney can address your will, trust, and estate planning issues, even before the divorce is final.
1. Consider the Designated Beneficiaries on Your Financial Accounts.
A divorce can restrict what people may do with their financial accounts. Speak with your attorney and be prepared to modify your designated beneficiaries, and know when you can do so.
Once the divorce occurs, Missouri automatically removes ex-spouses as account beneficiaries. However, keep in mind that this may not apply to all assets, including without limitation employer investment plans covered under ERISA. Making sure you hare an updated and correct beneficiary on all assets, and making sure that your will and trust is up to date, is crucial after you have divorce.
2. Now Is the Time to Update Your Power of Attorney.
In the event you become unable to make legal, medical, or financial decisions, you can have a designated person make important decisions for you. In the past, you might have assumed your spouse would step in to represent your interests. Now, consider naming someone else you trust.
Unexpected health challenges can arise at any time—not just when you’re elderly, and often not when you are “ready”. Once you know you’re divorcing, ask your Missouri attorney about updating or revising your power of attorney, for both finances and health care matters.
3. If You Have a Will, Plan a New One.
If you divorce, Missouri automatically revokes any bequests willed for your former spouse. But don’t leave a vacuum. Missouri probate law allows state residents to revoke a will via several different methods, including simply making a new Will that says that the old Will is revoked.
You’ll have two witnesses to watch you sign and to add their signatures to your will. Your attorney’s office can help you with notarization, and make sure the will meets Missouri’s self proving affidavit requirements.
4. Find a New Executor for Your Will.
Your will should name an executor to administer its provisions. Under the probate laws of Missouri, your executor can be someone your will names as a beneficiary.
Be sure to name a competent executor in your will. It is often easiest if this person lives in Missouri, but residency is not required.
5. If Applicable, Prepare Your Executor to Petition for a Small Estate.
If the assets you keep after divorcing are under a legal threshold ($40,000), your executor may petition the court to oversee probate for a small estate.
This begins a relatively simple form of gathering and distributing assets. Your attorney will assist with small estate affidavit Missouri requires.
6. If You Have No Will, This Is a Good Time to Create One.
If you have no estate plan, now would be the perfect time to meet with your attorney and create a will or trust.. Keep in mind, if your will leaves assets to a minor child, and you have not created a trust and named a trustee to hold on to such assets, they often could end up being held by your ex spouse, which for many clients would be exactly what they would NOT want!
Whether you draft a will or a trust under Missouri law, or some combination of the two, tap your attorney’s experience. Your attorney can recommend the right instruments for your own situation.
7. Keep in Mind That a Minor Children Bring Special Issues
If your children are minors, and you name them as beneficiary, this can bring about special considerations. Naming minor children as beneficiaries under a Will can often force a probate court to appoint a Conservator, who will oversee the assets until the child reaches adulthood.
With respect to both inheritance and custody concerns, your attorney’s help in drafting your will is vital if you have minor children when you’re going through a divorce.
8. Be Prepared for a Change in the Home Title.
By court order, a new property deed will often be drafted so the legal interest in any jointly titled homes will become vested in only one person, not two. Refinancing or selling is common for homes with mortgages. The debt often becomes the new sole owner’s responsibility.
Your attorney’s advice will help debts stay with the right parties. Often times, for the party that keeps the home, that home will be one of the largest single assets in the estate plan.
Find Out More About Missouri Estate Planning During Divorce.
Make the most of what you’re able to keep in the divorce. And for the long term, don’t leave important estate planning matters to chance.
Questions? Let The Piatchek Law Firm help. Call 417-882-5858 to schedule a consultation.