You might be surprised how many of my new estate planning clients realize, after we’ve talked a little, that their ex-spouses are still named as the primary beneficiary of their life insurance policies or, more often even, their retirement accounts. And given the value of those assets, their reactions in that moment of realization are far less surprising. If you are divorcing or divorced, you need to ensure that you have changed the beneficiary of those and other pay on death type accounts.
And given that you will no longer be sharing your life with your ex-spouse, it’s likely you won’t also want him or her to be the one to speak for you in the event of your incapacity or be the one to make medical decisions for you, including whether to discontinue life support, if you are ever unable to do so yourself. So if you already had such estate planning documents in place (such as a Health Care Proxy or Living Will), now is the time to revise them. And if you have never got around to putting those critically important legal instruments in effect, there’s no time like the present.
But if you are a parent of a minor child, there is an even more important reason to sit down with your estate planning attorney immediately. You must make appropriate provisions for the care of your child in case anything happens to you. Yes, it’s awful to think about, maybe the second worst thing a parent could imagine, but it’s even worse not to address it and leave your child’s fate up to chance. It is your parental responsibility, not to mention a selfless act of love, to do everything you possibly can to ensure that your child be raised by the people of your choosing. It is not enough to choose and discuss it with people privately; it must be memorialized in the appropriate legal instruments. Godparents do not, for legal reasons, count.
While it’s true that if you were to die before your ex-spouse, he or she would be the “natural” guardian of your child and most likely to assume full custodial responsibility, it is also true that he or she might die while your child is still a minor and if yours is the only legal document nominating a guardian (i.e. if your ex-spouse did not also legally name a guardian), your wishes could provide persuasive guidance to the court. But if your ex-spouse were to die before you, the court would likely look to the guardian you legally named to raise your child. If you and your ex-spouse are able to be civil with one another and co-parent as cooperatively as possible for the distinct benefit of your child, see if you are able to agree on and both name the same legal guardians for the sake of sparing your child more uncertainty in the event that you and your ex-spouse should both happen to die at the same time or very close in time.
Those are the bare bones basics. Above and beyond that, there are some more complex considerations. For examples, if you are concerned that your ex-spouse might remarry and then divorce again losing your child’s inheritance to that subsequent ex-spouse, you might consider creating an asset protection trust to secure your child’s inheritance from that as well as other possible (and not at all unusual) possibilities. If you and your ex-spouse have an irrevocable charitable trust, it may be possible to divide it. Or if you and your ex-spouse have established a pattern of gifting that you do not wish to continue, you should be careful to make your change of intentions clear.
Don’t feel overwhelmed. Your estate planning attorney should be able to meet with you and help you identify your most pressing concerns, your most important priorities, and based on that properly advise you and help you create a new plan to meet your new situation so you can move forward into the next chapter of your life with peace of mind knowing you have your legal affairs firmly in place.