How Marriage, Divorce, or Remarriage Can Affect an Existing Estate Plan
Planning your estate is definitely necessary to protect you and your family in the future. Nevertheless, people often make the following mistake: they think estate planning needs to be done only once in their lives. In fact, you need to reconsider your plans whenever something happens in your life, like getting married, getting divorced, or even getting remarried. Such life events influence who will inherit your property, who will make decisions for you, and who will play a crucial role in organizing your finances.
Marriage usually calls for an estate plan review
Entering into marriage will affect both your individual and financial situations. Although some individuals opt to create an estate plan after marriage, others may prefer to use the estate plan they created while single. However, there can be some consequences to that choice.
Upon getting married, you may consider:
- Adding your spouse as a beneficiary
- Designating your spouse as your executor or trustee
- Updating your durable power of attorney for finances and healthcare
- Revising the beneficiaries of your retirement plans and life insurance policy
Failure to do so may lead to an estate plan that distributes your assets as per your previous intentions.
Divorce does not automatically update every document
One assumption many individuals make is that when a marriage ends, all references to their former spouse in their estate plan will be automatically removed. In Virginia, some clauses in a will may become void after divorce, but this is not necessarily true of all estate planning documents.
Divorce can affect different estate-planning documents in different ways. Virginia law automatically revokes certain provisions benefiting a former spouse, but the rules vary depending on the document and the type of asset involved. Beneficiary designations for life insurance, retirement accounts, payable-on-death accounts, and other assets should therefore be reviewed directly with the relevant financial institution or plan administrator. Powers of attorney, advance directives, trusts, and other estate-planning documents should also be reviewed and updated as appropriate.
It would be wise to check if you still have anyone who you no longer want making decisions for you.
Remarriage can create unique estate planning challenges
Remarriages can create stepfamilies, stepchildren, and competing interests. You might be looking to care for your new partner while also making sure your children from a past marriage have something left for them.
It is essential that you plan for such issues carefully because otherwise they will create conflicts. For instance, giving everything you have to the surviving spouse might result in children from a past marriage being left out of your will.
A trust or some other form of estate planning can solve the issue for you.
Don’t forget beneficiary designations
Beneficiary designations are one of the most commonly overlooked facets of estate planning. This means that any assets held in an IRA, annuity, or life insurance policy will usually go to the designated beneficiary, irrespective of what your will states.
It is important to examine your beneficiary designation after a marriage, divorce, or remarriage.
Talk to a Virginia Beach, VA Estate Planning Lawyer Today
The Law Office of Angela N. Manz can help you and your family arrange a comprehensive estate plan that aligns with your current situation. Call our Virginia Beach estate planning lawyers today to schedule an appointment, and we can begin discussing your next steps right away.