You have survived your divorce; you are spent and drained of cash, emotion and energy. When the dust finally settles -it is a different process for everyone- you will want to move on; to move forward.
One of the first critical steps is to review and execute a new estate plan. This is particularly important when you have minor children; it is absolutely critical when you are planning to remarry.
Prior to meeting with an estate planning attorney, prepare an inventory of your post-divorce assets. When doing so, reference your judgment of divorce to be sure you know the precise nature of your interests relative to the former marital estate, includiing retirement assets, brokerage accounts, real estate and all other property.
When a divorce becomes effective through the entry of a judgment of divorce, many components of your former estate plan -created when you were a married couple- are invalidated. The invalidated components of your estate plan include any provisions that affect the property rights of you and your former spouse.
Here is a sample of some of the probate rights waived in a typical divorce judgment:
- The right to a probate a family allowance;
- The right to probate homestead allowance;
- The rights or claims of dower, courtesy, or any statutory substitute, now or hereafter provided, under the laws of any state in which the parties may die, be domiciled an/or in which they may own real property;
- The right to inherit property from the other by intestate succession;
- The right to receive any property that would pass from the deceased party by testamentary disposition in a will or trust executed before the property settlement agreement;
- The right of election to take against the Will of the other;
- The right to take the statutory share of an omitted spouse;
- The right to be appointed administrator or personal representative of the deceased party’s estate or executor of the deceased party’s Will, unless appointed under a Will executed after the date of this Agreement;
- The right to have exempt property set aside;
- Any right created under federal law, including, without limitation, ERISA and the Retirement Act of 1984;
- Any right, title, claim or interest in or to the property, income, or estate of the other, by reason of the parties’ non-marital relationship;
- Any right as a pretermitted or omitted spouse; and
- Any right to act as guardian or conservator of the other party’s property or estate.
In some cases, a divorced spouse will have rights to the ex-spouse’s estate as a form of security for support payments or property payments flowing from the judgment of divorce.
Other considerations include timely processing of qualified domestic relations orders, especially when you are the “alternate payee” and your ex-spouse is the “participant” or employee that generated an employment-based retirement plan. In such cases, funds must be segregated and disbursed in accord with the QDRO provisions so that you can designate a beneficiary or consider titling the asset into your estate plan and trust.
Yet another consideration is including your separate estate in your new post-divorce estate plan. For example, if you elect to prepare a trust after your divorce, you should consider re-titling all of your separate assets into the trust.
Some divorce proceedings end on the note of contentious compromise; the last thing the newly divorced want to do is get involved with anything legal. Yet this is exactly what you need to do. Rather than moving into the next phase of your life intestate, give serious consideration to a solid estate plan that follows through on the terms of your divorce and sets you up for future financial success and protection.
If you would like a free consultation to discuss your probate options following your divorce, contact our law firm.