Why Should I Consider Estate Planning During a Divorce?
October 31, 2017 | Divorce, Estate Planning, Legal Perspective, Marital Property
Often when clients are progressing through their divorce, it is overwhelming enough to handle the custody, support, asset division and valuation issues, let alone estate issues. All too often during these emotionally charged times, clients request their divorce lawyers to set aside any estate concerns until after the final settlement order of court dividing the assets is entered, which may take a while.
Is it worth revising your will while you are in the process of a divorce? If you are willing to leave your estate to your spouse — irrespective of whether they may have committed adultery, or just plain told you they did not want to be married anymore — then you do not need to review your estate plan. All others, pick up the phone and speak with your estate lawyer now. Pittsburgh divorce lawyers can advise on proper estate planning during your divorce so you are prepared, your assets are protected and your will is in order.
What if you do not have a will?
Each state has its own laws governing what happens to property when someone dies without a will. Generally, inheritance is generally limited to spouses, domestic registered partners, children and blood relatives. Typically, the surviving spouse receives a larger share of the estate, with some property also going to any children. If there are no children, the spouse sometimes receives the entire estate. Parents, siblings and charities may receive nothing. Rather than leaving the distribution of your estate to chance when you pass, you might need a testamentary will.
What is the purpose of a will?
A will is your written instruction, telling survivors how you want your property to be distributed. When you are married, and even while you are separated, your testamentary will is not necessarily the last word. For instance, if you disinherit your spouse in your will, your spouse might have a legal right to “elect against the will,” which in many states means the spouse can receive one-third of the assets of the deceased. A spouse’s elective share might include one-third of property that would not be divided in a divorce. That, in itself, is one good reason to create or amend your will during the divorce process, even if it is for a short period. At the same time, you also could protect your children by establishing a trust for their benefit, to be controlled by a trustee in which you have confidence.
A testamentary will does not dictate how all property will be distributed upon your death. For instance, any property or bank account jointly titled “with rights of survivorship,” will pass to the survivor. And, many retirement plans have beneficiary designations that determine how they will be distributed upon death. Typically, the court will frown upon either party changing beneficiary designations while the divorce action is pending. Thus, restricting the spouse’s rights to inherit is not an unduly restrictive action.
Many people routinely have powers of attorney and health care directives, designating their spouse as their fiduciary agent. If you are separated, you might not wish to have an estranged spouse make life and death decisions about your health. If you signed a durable power of attorney, your estranged spouse may have unfettered access to bank accounts, or the power to sell or encumber financial assets. A power of attorney can be revoked or replaced with a new power of attorney, designating a trusted family member or friend instead of your spouse.
When getting separated from your spouse, carefully review your current estate plan and consider a refresh or update. Contact the Pittsburgh divorce lawyers at Pollock Begg Komar Glasser & Vertz about how your estate plan fits with your legal strategy. It is worthwhile investing the extra time and effort to ensure your documents are in the best order they can be, while the divorce action is pending.
Candice L. Komar, founding partner of Pollock Begg, is a strong litigator, trained mediator and collaborative law attorney who often deals with divorces involving closely held businesses, complex issues and high net worth individuals. A fellow of the American Academy of Matrimonial Lawyers and recognized by local and national awards programs for her business sense and family law leadership, particularly in collaborative law, Candice is also often tapped by media to discuss hard-hitting custody and divorce cases.