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Divorce is never easy. In addition to all of the emotional aspects of a breakup, couples must deal with the financial impact divorce will have on them and their families. If you're navigating the process for the first time, you likely have questions about estate planning and divorce.
Luckily, with the help of an attorney, you can make it through the process with minimal stress. So, from wills to trusts and financial planning for divorce, here's what you should know.
What Is Estate Planning?
Estate planning is not just for the wealthy; it is for everyone. An estate plan is a set of documents that outlines what you want to happen to your assets and property after you die and instructions on how to manage your finances during life.
It can also include arrangements for future medical care, including living wills and health care proxy forms. These proxy forms allow you to choose someone who will make decisions for you should you become unable to do so.
Why Is Estate Planning Important?
Estate planning is essential because it allows people to determine who will take care of their family if they become incapacitated or pass away. A good estate plan should also protect your family from creditors and predators who may try to take advantage of an individual's assets.
A well-crafted estate plan can help prevent conflicts among your heirs while ensuring they receive what you intended them to receive when you pass away. It can also avoid probate court disputes over how much money each heir should receive from your estate.
If you're looking for a divorce attorney experienced in estate planning, Spidell Family Law can help!
Schedule an appointment TODAY to take the first step toward protecting your finances during a divorce.
Estate Planning and Divorce: 3 Things to Know About Your Finances, Wills, and Trusts
Divorces are always complicated, but even more so when there's money involved--and especially when there's not a prenuptial agreement in place. So, if you're beginning to explore financial planning after divorce, it's important to understand how your assets will be divided.
The most important documents to revisit when going through a divorce include the following:
● Will
● Trust
● Power of attorney
● Life insurance
● Financial accounts
● Guardianship
● Beneficiaries on 401K, investment accounts, etc.
Keep these three things in mind as you update those documents.
#1: Make Sure Your Will Is Clear and Legally Binding
A vague will may cause confusion and even legal battles among family members after your death. On the other hand, the more specific your instructions are in the document, the less room there is for interpretation. It's critical to ensure your documents are legally binding, so consult an attorney for review.
#2: List Executors and Trustees Carefully
Executors manage a will's assets, pay off debts, and handle the distribution of property. This can include selling real estate or managing investments. When choosing someone as an executor, consider their professional experience, financial acumen, and time availability.
A trustee manages trust assets until beneficiaries (usually children) need them. Make sure the people you choose as trustees have enough money management skills to do the job well, or you trust to work alongside a financial advisor for your best interests.
#3: Craft a Comprehensive Action Plan for Kids' Inheritance
If you have children, another consideration is how to handle their inheritance. The best way to do this is to craft a comprehensive action plan that works for you and your spouse. For example, you should consider the following.
● What will happen to the family home? Will it be sold, or will one of you live there?
● How will any remaining property be divided?
● Will all of the money be held in trust for the children until they are 18? Or will some of it go into a 529 college fund?
● How much will each child get, and when?
Spidell Family Law Can Help You Navigate Estate Planning and Divorce
Wondering how to choose an estate planning attorney?
The friendly, professional, and skilled team at Spidell Family Law can help guide you through what to consider when estate planning and how to manage your finances during a divorce.
Call TODAY for a consultation!
336-907-7047