Divorce and estate planning go hand in hand. While the number of divorces in Alabama and Cullman County is down from 6.1 to 3.6 in 1,000 people, this doesn’t make it any easier for those going through proceedings.
You planned a life with your spouse, shared assets and planned your estate around “happily ever after.”
Unfortunately, your divorce will trigger immediate changes to your estate plan and some that you might want to make before the divorce is finalized.
Alabama’s divorce and estate planning laws protect divorcees in ways that many other states do not. Alabama Code Section 43-8-137 outlines automatic changes to your plan, including:
If you appoint your spouse as your executor, which is quite common, this appointment is automatically revoked as well. You can add your ex as an executor following the divorce if you wish for them to maintain this right. For couples that fall out of love but remain close or best friends, the person can be added back into your estate plan after divorce.
Specific language must be in place to ensure that there’s no confusion that you want your ex to inherit a portion of your assets or any rights that you may grant them within your will.
However, if you remarry your ex, revocation of these rights may be reversed if they were revoked only due to divorce.
Notice that these changes pertain to your will and testament, which is only one of many estate documents that make up your entire plan. You must update quite a few documents to ensure that your current wishes are upheld.
Divorce and estate planning requires due diligence to validate that your post-divorce wishes are in place. Your estate may have one or a mixture of the documents below, all of which should be reviewed by a lawyer.
Documents that require immediate attention are:
Following a divorce, it’s typically best to revoke your old will and draft a new one. In Alabama, divorce automatically revokes your ex-spouse’s ability to inherit your assets. However, those assets may then be given to an alternative or residuary beneficiary, which may not be what you wish.
A new last will and testament will reflect your current wishes, including the person you wish to be the executor of your estate and the guardian of your minor children.
Just like your last will and testament, a new living trust should be executed after a divorce.
As a general rule of thumb, you should revisit your estate plan documents any time you experience a major life-changing event, such as a divorce. Otherwise, your last wishes may not be carried out the way you had hoped.
Following a divorce, you should update your powers of attorney documents to reflect your current wishes.
These can include:
Health care power of attorney is another advanced directive that must be updated. This directive gives someone else the power to make medical decisions on your behalf if you’re unable to do so yourself.
If your former spouse is listed as a beneficiary on your financial accounts, life insurance policy, real estate, or other assets, you will need to update these designations.
Retirement accounts that are opened or funded during a marriage are typically considered marital assets and divided during the divorce proceedings. In this case, the judge may determine whether you can make changes to your beneficiary designations on these accounts.
It’s important to remember that if your parents have an estate plan that names your former spouse as a beneficiary, they should also consider revisiting their plans.
Sometimes, divorcing couples remain friends and continue to trust each other. There is nothing preventing you from leaving assets or a gift to your ex in your will or naming your former spouse as:
However, you may still want to update your documents to reflect these wishes after the divorce is finalized.
If your divorce is still pending, you may wish to change your estate plan for a number of reasons. Alabama law only revokes a former spouse’s disposition to property from your estate after a divorce is finalized.
Until then, your soon-to-be-ex may still inherit your assets and make decisions on your behalf if you pass away or become incapacitated.
While your divorce is pending, you may wish to change your:
Alternatively, you may want to revoke your last will and testament or prepare a new one.
In either case, it is important to consult with an attorney if you wish to make changes to your estate plan before your divorce is finalized. Your attorney will guide you through the process and ensure that your documents are updated properly.
Divorce and estate planning can be complex, but we can help. Hankey Law Firm can guide you through the process of updating your estate after your divorce. We will work closely with you to adjust your powers of attorney, advanced directives, will, trust and other essential estate planning documents.
Our firm serves clients in Cullum, Blount, Morgan (Decatur), and Winston Counties.
Contact us today to schedule a consultation.