The Ultimate Guide: Divorce
The untangling of the lives of two intimately tied people is complicated and creates a lot of loose ends that need to be addressed. Review the steps below to address the most urgent priorities when going through a divorce to ensure you’re protected and your choices are honored.
Note: If you plan to move out of state, you will need to make sure your documents are in compliance with your new state. More information on things to consider when moving out of state here.
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Step 1: Health Care Proxy
Updating your health care proxy to name a trusted loved one as your primary agent is at the top of the list of urgent priorities. While most states would not automatically uphold a health care proxy that names an ex-spouse, unless your medical providers know of your divorce, there is no guarantee. The only way to ensure you receive the medical care you want, enforced by the person of your choosing, is to have a health care proxy document that reflects your wishes. If possible, add an alternate agent, particularly if your primary choice is not local.
Be sure your health care agent knows where you store your healthcare power of attorney and can access it in an emergency.
Step 2: Financial Power of Attorney
Once you’ve secured your medical information and decisions, your next priority is to protect your financial information and authority. Create a new financial power of attorney to ensure your financial commitments will be upheld should you become incapacitated. Make sure your financial agent knows where you keep the original and how to access it in the event of an emergency. If your employer offers any financial benefits, review the beneficiaries and work with your human resources department, if necessary, to update your policy documents.
Step 3: Will
Updating your health care and financial agents takes precedent since those documents can feasibly come into play during your lifetime. Once those updates have been made, it’s critical that you update your will and/or trust to reflect your change in circumstances. Even though most states would not allow an ex-spouse to inherit from a will executed prior to the divorce, it still does not address who you do want to inherit your assets. Without an updated / valid document, assets are distributed by a probate court in accordance with your state’s laws of intestate succession. Updating your will allows you to control who gets your assets and who will take charge of your estate.
Your will is also your opportunity to update legal guardians for minor children, adult dependents, and pets.
Supplemental Policies & Accounts
In addition to these critical legal considerations, be sure to review your life and other insurance to make sure it meets your current needs. Lastly, remember to change the passwords and any PINs to all sensitive accounts and information including health, financial, and social media/digital accounts.
Checklist
- Have you updated your health care proxy and provided your health care providers with your new document?
- Have you updated your financial power of attorney and provided it to your financial institution and/or advisors?
- Have you updated your will / trust to reflect any changes in beneficiaries and/or guardians?
- Have you informed one or more trusted loved ones of where you keep your documents and how they can access them in the case of an emergency?
- Have you reviewed all your beneficiary designations on any insurance, retirement accounts, etc. to reflect your new marital status?
- Sometimes a spouse is ordered to maintain life insurance for the ex- spouse. If that is your circumstance, make sure you purchase it right away. Also make sure that you also have life insurance for whomever else you want to benefit.
- Have you changed all your passwords and PINs to secure your personal information and sensitive accounts?
