When you first start estate planning, you make choices based on your life at that moment. The people you include in your estate plan are the people important to your life. These loved ones will inherit your assets and make decisions about your healthcare.
However, life changes. Your estate plan should change with it. One of the biggest reasons to update your plan is divorce. Here are a few documents that will need updating once you decide to end your marriage:
- Last will and testament – If you wrote your will a long time ago, you likely put your spouse as the primary beneficiary. Now that you plan on divorcing, you will need to update it if you want to decrease the amount your spouse gets.
- Trust documents – Like the will, trust documents name the person who receives your assets after you pass away. If you don’t want to leave your inheritance to your spouse, you can make your children or other loved ones beneficiaries.
- Power of attorney – As power of attorney, your spouse can make financial decisions for you if you become incapacitated. You may want to give this power to someone else.
- Healthcare surrogate – If an accident or illness leaves you unable to make decisions, your healthcare surrogate can choose medical treatment on your behalf. Like a power of attorney, you may want to give this authority to someone else you trust.
- Life insurance and retirement account beneficiaries – These accounts don’t go through your will or your trust. Instead, the plan holders pay your beneficiaries directly. You will need to update these if you don’t want your spouse to receive anything.
As you go through your divorce, you may want to exclude your spouse from receiving your assets. As soon as you know your marriage will end, you should update your estate plan.