If you’re preparing for divorce or have already begun the process, it’s important to go through your estate plan, if you have one in place, and determine what modifications need to be made. Some changes can be made at any time. Others will be made automatically by the law when the divorce is final.
While the last thing you likely want to do is deal with more legal documents or spend more time in a law office, it’s important to understand why your divorce will almost certainly affect your estate plan. The following are two concerns which are, in some cases, just the tip of a very consequential iceberg.
Your spouse’s inheritance
Sometimes, one of the first things a divorcing person wants to know is when they can disinherit their spouse. You can technically remove your spouse from your will. However, under Indiana law, they would have a right to claim a share of your estate if you passed away while you’re still legally married – unless they gave up that right in a prenuptial or postnuptial agreement.
When the final divorce decree is issued, Indiana law automatically revokes “all provisions in the will in favor of the testator’s spouse.” If you made no changes yourself at that point and passed away, the contingent beneficiary you have listed would inherit the assets. If you don’t have a contingent beneficiary, it’s important to designate one.
If you do still want to leave an inheritance to your ex-spouse or it’s required under the terms of the divorce, you’ll need to modify your estate plan accordingly since the law won’t recognize your original designation of their inheritance.
Your spouse’s fiduciary responsibilities
Indiana law also automatically revokes a spouse’s fiduciary responsibilities (as an executor, power of attorney or trustee, for example) once the divorce is final. That means you’ll want to be sure you have one or more replacements designated.
Since estate administrators generally don’t have to be the spouse, you can likely do this at any time. As with the inheritance, if you want your spouse to continue to have these responsibilities, that needs to be recodified in the estate plan after the divorce.
While the law is straightforward, each situation is highly unique. That’s why it’s wise to get experienced estate planning guidance to help ensure that you make the necessary updates to your plan, so that your wishes are up to date and enforceable from now on.