5 Ways to Improve Your Estate Plan After a Divorce

Going through a divorce is a major life change, but it can also be a fresh start that allows you to look forward to new opportunities and to set your own priorities. One of those opportunities is re-defining your future estate distribution plans while also ensuring you will be remembered the way you would want to be.  

But first things first. As a divorce can be emotionally draining, you may want to give yourself some time to let the dust settle before jumping right into creating a full-blown estate plan. With that being said, there are some steps you will want to take immediately to ensure your ex-spouse does not inadvertently inherit assets of yours, or other unintended consequences do not occur by not updating your existing legal documents.    

Let’s get started in re-doing your estate plan. 

1. Take an Inventory of All Your Assets

Take the time to go through your divorce decree with your attorney and financial planner and make sure you understand how the assets were split up.  Make a list of all your bank and investment accounts, retirement plans, life insurance policies (including any group insurance), real estate and any other property you may have an interest in. (For more from this author, see: 7 Financial Tips for Women Preparing for Divorce.)

2. Review and Update Beneficiaries

Now that you have a list of all your assets, go through each one, and depending on the type of account, your specific situation, the age of your children (if they are the intended beneficiaries) and the wording of the divorce decree, you may need to assign new beneficiaries for accounts that you were awarded or will maintain ownership of. 

This can include: 

3. Review Any Legal Agreements You Signed With Your Ex-Spouse During Your Marriage

You will want to carefully review each of the documents below, as applicable, to update their provisions based on your divorce. This may include naming a new executor/executrix of your will, updating its provisions, and reviewing who you previously named as guardians for your minor children should you and your ex-spouse die.

Also, you may want to create and or revise any existing revocable trusts to ensure the named successor or co-trustees, beneficiaries and provisions reflect your current wishes and change in circumstances. Ensure your durable power of attorney and health care proxies are also updated. If you don’t have these documents, you should consider getting them. (For related reading, see: 6 Estate Planning Must-Haves.)

4. Reassess Your Estate and or Inheritance Tax Situation

A divorce can change the impact estate or inheritance taxes may have on your estate at death. Review the current estate tax implications of passing your assets to your heirs now that you are single and your estate and gift tax exclusion amounts you may have planned for previously have most likely changed.

5. Reassess Your Estate Plan Every Three to Five Years

Regardless of what the situation was when you became divorced, your life circumstances will inevitably change over the years. With that in mind, you will need to reassess your estate plan every few years to make certain it still meets your estate transfer objectives. Here are a few major life changes that will require changes to your estate plan and meeting with your attorney and financial advisor:

Minor children reach the age of adulthood: Your divorce decree may have mandated that your ex-spouse would be the guardian of any minor children and may have been in charge of any assets that went to them. However, once your children reach legal age, you may need to make changes to legal documents so you ex-husband is no longer listed as a beneficiary. 

You are getting remarried: Regardless of your age at the time of divorce, you cannot count out the possibility of getting remarried. Just as getting divorced takes legal planning with an attorney and a financial advisor to safeguard your assets and your heirs, so does getting remarried. While this can be a joyous time of starting a new chapter in your life, you and your future husband will want to make sure each of you has the proper safeguards in place to protect the assets you have acquired and the inheritance you have for your children.  

You are nearing retirement—as you grow older, changes in income or health may make it necessary to re-evaluate your financial plan and who will be in charge of your estate. Do you need to make changes to your power of attorney regarding healthcare or financial decisions? Would it be advantageous to look at asset protection trusts, long-term care insurance, or increasing your gifting to your children or grandchildren? Meeting with an attorney and financial advisor before you have health issues or need long term care can help you to safeguard your assets.

(For more from this author, see: Social Security Benefits for Widows and Divorcees.)


Representatives of Signator Investors, Inc. do not provide tax and legal advice.  Please consult your tax advisor or attorney for such guidance.

Securities and Investment Advisory Services are offered through Signator Investors, Inc., Member FINRA/SIPC, a Registered Investment Advisor. AspenCross Wealth Management is independent of Signator Investors, Inc.  1400 Computer Drive, Westborough, MA  01581