An Arkansas divorce often prompts the need to revisit various aspects of your financial and legal affairs. An important consideration during this period is the reassessment of estate planning documents.
As relationships change, it remains important to ensure that your wishes align with your current circumstances.
Will
An estate planning document requiring immediate attention after a divorce is your will. This document outlines your wishes regarding the distribution of assets upon your passing. Following a divorce, your priorities and preferences may shift, necessitating a careful review and revision of your will. Ensuring that your assets undergo distribution in line with your intentions helps avoid complications. It also helps you maintain control over your personal and financial affairs. However, CNBC notes that only about 33% of Americans have these important documents in place.
Life insurance and retirement accounts
Life insurance policies and retirement accounts often require the designation of beneficiaries. Revisit and update these beneficiary designations after a divorce to reflect your current preferences. Failing to do so may result in unintended consequences, such as former spouses inheriting assets that you may now wish to allocate elsewhere. Regularly reviewing and updating beneficiary designations ensures that your assets go to the individuals you intend.
Power of attorney
A divorce may prompt a reconsideration of the individuals granted power of attorney over your financial and health care matters. The Power of Attorney document allows someone to make decisions on your behalf if you suffer incapacitation. You may want to appoint someone other than your former spouse to fulfill this role.
Health care directives
Similar to the Power of Attorney, health care directives outline your wishes regarding medical treatment in the event of incapacitation. After a divorce, consider reviewing and revising these directives. You may wish to name a new individual to make health care decisions on your behalf or adjust your preferences based on changes in your life circumstances.
A divorce prompts a reassessment of estate planning documents to align them with your current circumstances. Reviewing these documents helps safeguard your assets and ensure that your wishes come to be when you pass.