Divorce is challenging for anyone going through the process. It can significantly impact estate planning and wills, especially for wealthy individuals. Understanding these changes ensures your estate plan reflects your current wishes and circumstances.
Power of attorney and healthcare directives
Divorce necessitates updating power of attorney and healthcare directives. These documents grant decision-making authority to trusted individuals in the event of incapacity. You’ll likely want to appoint someone other than your ex-spouse to manage your affairs. A power of attorney can also make healthcare decisions on your behalf.
Revise your will
After a divorce, the first step is to update your will. This often involves removing your ex-spouse as a beneficiary. Be sure to adjust the asset distribution, or your ex-spouse might inherit assets meant for others.
Update beneficiary designations
Wealthy individuals often have various accounts with designated beneficiaries. These accounts include life insurance policies, retirement accounts, and investment portfolios. It is important to update these designations to reflect your new circumstances.
Trust modifications
Consider modifying your trusts. Modifications could involve changing the trustees and beneficiaries. It can also mean updating the terms of the trust to align with your post-divorce intentions. Ensuring that your trusts reflect your current wishes helps to protect your assets. Updating trusts also provides distributions for your intended beneficiaries.
Protect your wealth
Estate plans, wills, and trusts are essential documents for wealthy individuals to manage. Keeping these documents updated during a divorce protects your wealth and current wishes, securing your assets for the future.