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3 Things You Must Do Once Your Divorce Is Final

Posted by Jim Filippi | Mar 05, 2020 | 0 Comments

The divorce process can be long and expensive.  However, the work does not end once the divorce decree is signed. In order to ensure that your assets and estate planning wishes are carried out in light of this major life change, there are three things you must do as soon as possible. A delay can have disastrous results if something were to happen to you before you had a chance to complete these tasks. 

Change Beneficiary Designation on Life Insurance

A life insurance policy is a contract between you and the insurance company.  You designate the beneficiary (the individual(s) or entity who will receive the proceeds upon your death) and the insurance company will pay them when you die. Because the beneficiary designation is a legally binding contract, the insurance company has to pay the individual listed as your beneficiary. If your ex-spouse is listed as the beneficiary, they will pay the funds out to him or her.  It does not matter to the insurance company if the two of you are now divorced.

Update Beneficiary Designation on Retirement Plans

Although state law may automatically revoke a designation on a retirement plan if the ex-spouse is listed, federal law states that the last-named beneficiary is the one who is entitled to the funds. Depending upon what type of retirement account you have, it might be the state law that controls, or the federal law.  To be on the safe side and avoid a potentially long and costly battle for your family, it is best to change the beneficiary as soon as possible. 

Create or Revise Your Estate Plan

If you and your former spouse had a joint trust, you will need to have your own individual trust created to hold the assets that are now in your name only. In this new plan, you will need to think about who to name as the trustee and beneficiary. If you have minor children, you may also need to consider who is going to be the individual to manage those assets on behalf of your children. In many cases, you probably don't want your ex-spouse in these roles.

If you do not have any estate planning documents in place, now is the perfect time to get everything in order. After going through the divorce, you probably have a good idea as to what assets you own and the value of them.  This will be very helpful as we discuss the right estate plan for you. 

Your estate plan is more than just a trust.  It can include documents such as a financial power of attorney and healthcare power of attorney.  Whether you have them already or need to have ones executed, this is a crucial time to review them.  Chances are you no longer want your ex-spouse to have the authority to sign documents on your behalf or make medical decisions for you. To avoid confusion by third parties as to who should be acting on your behalf, make sure to call us so we can update these essential documents.

Designating guardianship for minor children is another important task that needs to be addressed.  Obviously, if something were to happen to you, the children would go to your ex-spouse, but what happens to them if the ex-spouse were to pass before you, or even simultaneously?  This obviously can create a quagmire and is something that should be addressed so that your children are properly cared for by those that love them.  If possible, it is also something that can be coordinated with your ex-spouse, if you're on good terms.  That way the new guardians will have the support of both families if something were to happen to you both. We can help you with all of this as well.

We can help you cross the finish line

Divorce can be a long and tiresome process. Before taking those next steps into your new life, call us, so we can make sure that you cross the finish line with documents that are able to carry you and your wishes forward.  Start your new life off on a good foot and that can should start with getting your affairs in order. 

About the Author

Jim Filippi

Jim Filippi, Esq. Principal Attorney Attorney Jim Filippi is the founder and principal attorney for the Filippi Law Firm.  He is a native of Northern California where he was born and raised. Jim has an extensive educational background, graduating with the following degrees: Juris Doctor (JD...

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