What You Should Know About Divorce and Estate Planning
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I Didn’t Do Anything Before the Divorce Was Final - What Do I Need To Do Now?

MINOR CHILDREN AND GUARDIANSHIP

If you do not have a trust and you have young children, now may be the right to time create one. If something should happen to you, either disability or death, your former spouse will have full custody of the children. If you leave assets to your children and they are minors you create two problems.

First, someone will need to petition the court to become guardian of the estate to control the assets. Second, that someone is likely to be your former spouse. By leaving your assets in a trust for your children you control who manages the money and the need for a guardianship is eliminated.

WILLS AND DURABLE POWERS OF ATTORNEY

To avoid these problems you should have your Will, Financial Durable Power of Attorney and Advance Healthcare Directive redrafted. In addition, your goals may have changed for your estate plan due to the divorce. These changes should be reflected in a new plan.

TRUSTS AND OTHER ESTATE PLAN MATTERS

You also need to review other parts of your estate plan. Beneficiary designations for your retirement accounts and life insurance policies remain in effect until you change them. Unfortunately, there are many cases out there where someone has gone through a divorce and forgotten about their estate plan. We have numerous cases where an ex-spouse remains the beneficiary of a life insurance policy. Because life insurance is a contract, the former spouse as primary beneficiary stands and the other beneficiaries are left out! The same is true of retirement accounts. The beneficiary designation controls. You must immediately change the beneficiaries of your life insurance and retirement accounts.

If you have a trust, the trust remains in effect, and if it is a joint trust, your former spouse remains as a trustee of the trust. Even if your trust provides language dealing with divorce, you should consider revoking the trust and creating a new trust tailored to your new situation and goals. You may also want to consider restating the current trust in its entirety.

Lena Barnett & Associates, L.L.C.

Our firm designs estate plans that work. We offer client centered counseling to develop a plan custom-designed for you. Our initial meeting is used to learn about you, your family, your estate and, most importantly, your goals.

It is our goal to provide you with a plan that works for you. Plans that work allow you to control your property while you are alive and well, take care of yourself and your loved ones in the event of disability, and upon your death allow you to give what you have - to whom you want, when you want, the way you want, and all at greatly reduced financial and emotional cost to you and your loved ones.

This information was prepared by Lena Barnett & Associates, LLC and is intended only to provide general information. It is neither offered nor intended for use as legal advice, nor is it a substitute for a consultation with an attorney.

© 2006 Lena Barnett & Associates, L.L.C. All Rights Reserved

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