1. Home
  2.  – 
  3. Estate Planning
  4.  – What you should know about modifying your estate plan in divorce

What you should know about modifying your estate plan in divorce

On Behalf of | Nov 9, 2022 | Estate Planning

If you have an estate plan when you divorce, you’ll need to make some changes to it. While the last thing you may want to do right about now is spend more time looking at legal documents, this is not something you don’t want to neglect.

Timing is crucial. Some changes you can make before the divorce is final. Others need to wait until it is. You also want to be sure that you don’t do anything that violates any terms of your divorce. Let’s look at a few areas you’ll likely need to address

Powers of attorney (POA)

Chances are, you have a POA giving your spouse the authority to make decisions on your behalf, or as designated in your advance directive, regarding your health care if you become incapacitated and unable to speak for yourself. They likely have a financial POA as well. You can change the person you designate for these responsibilities any time. You don’t have to wait until your divorce is final.

Your will and living trust

Under Michigan law, you can’t completely disinherit a current spouse. While it’s wise to start thinking about any changes you’ll want to make, they will likely depend in part on what each of you end up with in your property division agreement. Therefore, it’s probably best not to make any changes until immediate after the divorce is finalized.

Beneficiary designations

You likely have your soon-to-be-ex listed as at least one of the beneficiaries on your retirement and investment accounts as well as your insurance policies. Remember that any changes made to these need to be made with the financial institution or other company that holds them rather than just in your estate plan (if they’re even listed there). If there’s a discrepancy, what’s on the actual account takes precedence.

Again, you’ll likely need to wait until the property division agreement and the divorce are final to make changes. Further, if you are ordered to pay child and/or spousal support, you may be required to have a life insurance policy with your ex as your beneficiary.

Every estate plan is unique, and every divorce is certainly unique. Therefore, it’s crucial to have legal guidance for your own situation as you make modifications to your estate plan with your divorce.