If you have disability and estate planning documents already drafted but are now in the process of divorcing or have already divorce, it is critical to contact a wills and trusts lawyer Scottsdale AZ residents rely on in order to update those plans. Failure to do so could result in your ex-spouse having decisions over financial and medical decisions for you should you become incapacitated or inheriting assets you own that have them as the beneficiary. The following are documents that you should definitely review if divorce is in your future:
Last Will and Testament
In many states, anything you have bequeathed in your will to your spouse is no longer valid if you are legally divorced upon your death. However, that may not be the situation in the state you live in, so it is important to contact your attorney and make the necessary updates to your will otherwise there is still a legal possibility your ex could benefit financially from your death.
Beneficiary Designation
Just like the laws are regarding wills, a divorce may do nothing to change the beneficiary designation you may have on life insurance policies, retirement accounts, pensions, annuity funds, or other types of accounts where you are required to have a designated beneficiary.
In many states, you are required to make these changes directly by contacting the plan administrator or other appropriate party to remove your ex-spouse as beneficiary. There have actually been instances where an individual divorced their spouse but failed to remove them as beneficiary, remarried, and passed away, however, it was their ex-spouse who received the funds and not the current spouse.
Even in states where a divorce does revoke your ex-spouse as beneficiary, which may not take effect until the divorce is actually final. So if something happens to you while you are in the middle of a contentious, drawn out divorce battle, the person you are trying to divorce will still be the legal beneficiary.
If you have made the decision to divorce your spouse or petitions have already been filed, change all of your beneficiary designations right away to avoid any issues.
Power of Attorney
Many couples have power of attorney authorizations included in their estate plans which authorizes the other spouse to act as their agent in the even they become incapacitated. In most states, the filing of the divorce petition will revoke that power of attorney, however, it is best to check with your estate planning attorney to verify that is the case in your state.
Advance Health Care Directives
This is another document that is typically included in a couple’s estate planning documents, granting authorization to make medical decisions for the other spouse should they become incapacitated. The same rules that apply to power of attorney authorizations apply to these documents but it is still a good idea to verify that with your attorney.
In all these estate planning documents that automatically revoke the other spouse’s authorization, or inheritance in the case of a will, it is possible to keep your spouse as an heir or your agent if you specific in these documents that this is still your wish despite the divorce.
Thanks to our friends and contributors from Arizona Estate Planning Attorneys for their insight into estate planning.