By Jessica S. Batsevitsky
If you are divorced, it is especially important to re-visit your estate plan. In all likelihood, your former spouse is the primary beneficiary of your will or trust, and holds many important positions upon your death or incapacity. This is probably no longer appropriate.
The first question to ask, however, is whether there are limitations on your ability to change your estate plan.
Several factors might bring limitations:
If it is permissible to proceed, revising your estate plan can help ensure that your interests are protected in case of your incapacity, and your loved ones are cared for in your absence.
Questions to consider include:
A Massachusetts law revokes certain transfers to spouses, and appointments of spouses to fiduciary positions, after divorce. However, reliance on this law alone is not recommended. When the law applies, it could leave holes in your estate plan after a former spouse is removed. Worse, in some cases, is that the law might not be uniformly applied to all of your assets.
Pay special attention to the death beneficiary designations on your retirement plans. Many people neglect to update these designations following a divorce, so the former spouse remains the designated beneficiary. Some administrators of retirement plans take the position that, under federal law, they are required to pay proceeds to whomever is designated on the plan, even if there has been a divorce, and even if state law holds otherwise.
An experienced estate planning attorney can help you through the process of creating an estate plan that fits your new circumstances. This can help you find peace of mind in knowing that people you trust are empowered to act on your behalf if needed, and your loved ones will be cared for in your absence.
If you are divorced, it is especially important to re-visit your estate plan. In all likelihood, your former spouse is the primary beneficiary of your will or trust, and holds many important positions upon your death or incapacity. This is probably no longer appropriate.
The first question to ask, however, is whether there are limitations on your ability to change your estate plan.
Several factors might bring limitations:
- You may have entered a prenuptial or postnuptial agreement containing terms related to your estate planning.
- While a divorce action is pending in Massachusetts, an automatic temporary restraining order is placed on the assets of both parties.
- Your divorce agreement or judgment may contain requirements related to your estate plan, such as a requirement to maintain a life insurance policy for the benefit of your former spouse and/or children.
If it is permissible to proceed, revising your estate plan can help ensure that your interests are protected in case of your incapacity, and your loved ones are cared for in your absence.
Questions to consider include:
- Who will make medical and financial decisions on your behalf if you become incapacitated?
- How should your property be divided and distributed when you pass away?
- Who will hold and manage funds for your children if they are minors when you pass away?
- Who should serve as your minor children’s guardian if you and your former spouse are both deceased?
A Massachusetts law revokes certain transfers to spouses, and appointments of spouses to fiduciary positions, after divorce. However, reliance on this law alone is not recommended. When the law applies, it could leave holes in your estate plan after a former spouse is removed. Worse, in some cases, is that the law might not be uniformly applied to all of your assets.
Pay special attention to the death beneficiary designations on your retirement plans. Many people neglect to update these designations following a divorce, so the former spouse remains the designated beneficiary. Some administrators of retirement plans take the position that, under federal law, they are required to pay proceeds to whomever is designated on the plan, even if there has been a divorce, and even if state law holds otherwise.
An experienced estate planning attorney can help you through the process of creating an estate plan that fits your new circumstances. This can help you find peace of mind in knowing that people you trust are empowered to act on your behalf if needed, and your loved ones will be cared for in your absence.
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