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Divorce Impacts | Singh Law Firm

How Divorce Impacts Your Estate Planning

When you’re in the thrall of a new marriage, it can be hard to imagine how you’d ever get divorced—yet statistics reveal that divorce is common, and can happen to anyone. Indeed, divorces can be abrupt and surprising, disrupting years of harmonious domesticity and affecting every aspect of the family’s life.

Even apart from the obvious consequences of divorce—emotional and financial fallout alike—there’s another major area to consider: Estate planning. You may already have an estate plan in effect, but divorce can pull the rug right out from under you, and cause you to need a whole new plan, or at least significant revision, like the need to divide debts. In this post, we’ll offer some general tips for divorce estate planning.

The Automatic Reset

If you’re in California, you should know that—per state law—all estate planning arrangements are automatically reset once the divorce proceedings push through. This includes trustee and executor nominations (for revocable living trusts in California, for instance), as well as special powers granted to the spouse in relation to shared properties.

With that said, also note that the soon-to-be-ex-spouse will hold certain estate rights throughout the divorce proceedings—something to keep in mind. Some special provisions may come into effect if the spouse is a non-resident. (And, if your spouse is not a citizen, you may need to ask about a qualified domestic trust. A qualified domestic trust will allow even non-citizen spouses to claim certain estate planning benefits.)

In Case of Accident or Death

That last point—about how the estranged spouse retains estate planning rights during the divorce proceedings—is worth unpacking a little bit here. Note that, in the event of incapacitation or death, the estranged spouse can still receive the full benefits of the existing estate plan (or most of it, if there are children also listed as benefactors).

Again, if you live in California, this is automatic, unless you have other arrangements explicitly spelled out in your estate plan. This is a technical point you can discuss with your estate planning lawyer.

The Pre-Nup

Now, what about prenuptial agreements? These arrangements are made to protect both parties in the event of a divorce, yet often, they have not been updated since the marriage’s early days.

A pre-nup could have a big impact on estate planning post-divorce, and in fact, it’s possible that certain asset transfer clauses may need clarification. Pre-nups, like estate plans, should really be revisited on a regular basis. Work with your attorney to keep these important arrangements totally up to date, and to make sure your estate plan works according to State prenuptial laws.

The Children’s Share

Children must not be overlooked when considering the divorce’s effect on estate plans. Apart from the question of guardianship, divorce can affect what share the children receive from split assets, the duration for the asset transfer to take effect, and who will execute the trust (if the ex-spouse is not preferable).

In the end, it is the children who are most affected by divorce proceedings, and both parents will want to do anything they can to make sure their kids ae protected and cared for properly.

Working Out Your Estate Plans

It’s vitally important to ensure that your estate plans remain up to date. That means revising them at least once a year, with guidance from your attorney, but it also means conducting a review after any life-changing event—and a divorce surely qualifies. The need to update the trust and will following a divorce is urgent.

Review your estate plans to make sure they reflect current wishes, goals, needs, and realities. And, if you need the input of a trained estate planning lawyer, reach out to the team at Singh Law Firm today. We are always here to discuss post-divorce estate planning, the use of a revocable living trust in California, ways to navigate the California probate code, and more. Contact Singh Law Firm today!


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