With the high divorce rate in this country, many legal issues can arise before, during and after a divorce is final, or even before it is filed. One area that can be strongly impacted by divorce is estate planning. Once the legal bonds between spouses are dissolved, many things that seemed automatic about who gets what when one spouse dies and numerous other family and financial issues become much more complex.
First of all, one you have a final divorce decree, make sure that it becomes part of your important estate planning documents. While seeing the end of a marriage on a piece of paper may not be something you want to focus on at the time, remember that not only does that paper represent the end of a marriage, but it also defines your rights and obligations in many ways going forward. And many of these will survive your death.
One of the most important things that a divorce doesn’t necessarily change is who is named as beneficiary on insurance policies, retirement accounts and other assets that typically pass outside of the probate process. If you have named your spouse as beneficiary of a life insurance policy, your divorce decree does not automatically change that. If you had a less than amicable divorce, your heirs will probably not be happy if your ex-spouse gets the proceeds of a $100,000 life insurance policy which, depending on the size of your estate, could be more than your children or other heirs get when your assets are divided.
And on the subject of insurance, in most states the child support obligation survives the death of the parent who pays. So having a life insurance policy to cover child support payments until the child is no longer eligible to receive it is an important issue to address after divorce. The amount of the insurance policy can be reduced annually as the total amount of the child support obligation decreases.
These are all good reasons to schedule a regular estate plan review with your estate planning attorney. Sit down and review your plan at least once every 2-3 years, but also make an appointment to review your plan immediately after any major life event such as a divorce, marriage, death, birth of a child or grandchild, etc.