According to studies conducted by the Pew Research Center, overall divorce rates have gone down in the United States. Despite this, studies show that the rate of divorce for couples over the age of 50 has almost doubled since 1990.
These divorces typically present challenges that younger couples may not have to face. For example, you may have a more complicated and interwoven estate plan than a younger couple would. Here are a few estate planning steps you should follow when going through a gray divorce.
Update your will
Under Massachusetts law, a divorce decree will automatically remove spouses as beneficiaries to a will. This is helpful because it keeps your ex-spouse from claiming your property after you pass.
However, you should update your will to include your preferred beneficiaries of your estate. If you die and have neglected to update your beneficiaries, the state will decide what happens to any assets that would have passed to your spouse.
Update power of attorney and healthcare proxy
When you were married, you and your spouse may have designated one another as the preferred guardian or healthcare proxy in case injury or another health concern kept either of you from making your own decisions. Under the Uniform Probate Code (UPC), the state automatically revokes these responsibilities in the event of a divorce.
The UPC, however, will not name a replacement for these responsibilities. So, you should still take care to update these designations so that the right people can care for you, should you become incapacitated. Even if you want to keep your ex-spouse as your preferred guardian, you will have to update these plans after you divorce.
Update insurance beneficiaries
Insurance is often overlooked during the divorce process. However, there are many insurance concerns that you should address. For example, you may have a life insurance policy with your spouse named as a beneficiary.
In some cases, your divorce agreement may require you to keep your spouse as the beneficiary of your policy. If there are no obligations, you may name someone else as the beneficiary. Unlike wills, an insurance company will not necessarily remove your spouse as the beneficiary of a policy.
Take care of estate planning issues quickly
You should remember that any automatic changes to your will and power of attorney wishes only apply after a divorce is finalized. Because of this, you should work to resolve estate issues as quickly as possible.
Working with an estate planning attorney can help you determine what moves you can make to protect your estate during major life changes.