New York Estate Planning & Elder Law Blog
As Bill Gates prepares to navigate the divorce process, divorce has again entered the public consciousness and caused many people to question the nature of how marriages dissolves and how it impacts various aspects of our lives. One often overlooked aspect of divorce is how it can impact overall plans for the future.
To minimize the potential impact that divorce has on their lives, many high-power couples including Bill and Melinda Gates enter into settlement agreements. Even ordinary couples, however, discover that divorce has the potential to impact their estate plans. This article discusses some of the most important issues that couples should consider about how divorce can impact estate plans as well as what you can do to make sure that your estate plan continues to achieve your goals.
Life Insurance
Life insurance is commonly utilized as a planning tool in divorces. For couples with younger children as well as those considering alimony, life insurance can play a valuable role. Divorce can be a suitable time for the examination of beneficiaries or taking life insurance to achieve planning goals.
Pensions
Many people list a spouse under the terms of their pension or other retirement accounts and then forget they have done so. While your pension might be defined around a single life, you also might have opted for a “joint and survivor annuity” meaning that all or a percentage of what you receive monthly goes to your beneficiary. As a result, it’s critical to make sure that these accounts are adequately updated to make sure that your assets transfer to the appropriate beneficiary.
Powers of Attorney
It’s a common strategy to appoint a spouse under a power of attorney to handle either financial or healthcare-related decisions. If you’re going through a divorce, it’s important to make sure that these documents appoint someone else to act in such a role.
Title
How to title real estate is often a critical question during divorces so ownership of various real estate is not negatively impacted by the dissolution of a marriage. If one spouse receives a property that was jointly owned by the couple before the divorce, this property should be adequately retitled to reflect this ownership. Titling bank accounts and other assets are also critical.
Trusts
Divorce is an excellent time to either make a trust or modify the terms of an existing one. It’s critical to review trusts if you have minor children and would like someone other than your former spouse to manage the assets that are passed on to your children.
Wills
Many married couples name one another as mutual beneficiaries under wills. If you’re going
through a divorce, you should review your will to make certain that assets pass on your death in the desired manner. Not all assets, however, pass according to the terms of the will. Instead, some assets pass as the result of the title, which is why it’s also critical to make sure that titles are properly recorded.
Speak with an Experienced Estate Planning Attorney
Divorce can substantially impact your estate plan. To make sure that your estate plan continues to achieve your goals, you should not hesitate to speak with an experienced estate planning attorney. Contact Ettinger Law Firm today to schedule a free case evaluation.