Tim Henry of Aspire Planning and I chat about why it is critical to update your estate plan after a divorce or separation.
We all have clients who will experience a relationship breakdown at some point in their life, and you can play a valuable role in helping them take control of their new life by getting their estate planning updated and giving them comfort that the right people will be in control of their wealth and their assets will pass to the right people.
If you’re after a bit of support about how to have these conversations, I have a free conversation template for this exact conversation available at https://www.taralucke.com.au/free-conversation-templates/
Tara is going to give us a few tips today on why it’s important to look at your estate plan and probably redo it if you’ve just gone through a divorce. So Tara, what are the key reasons why someone would want to do that if they’ve just gone through it?
Yeah, really good point, Tim. And I know if you’ve just been through a divorce, you probably don’t want any more lawyers in your life, but it’s really important to take control of your estate plan as you’re building your new life. Just take control and get peace of mind with your estate plan as well because it can be a forgotten piece of the puzzle, particularly if you’ve just been divorced.
You want to make sure that your former spouse is not going to be the financial controller of assets if something goes wrong, whether you die or under your power of attorney if you’re still alive. So making sure you update those to have people that you trust in those roles. And in some states as well, getting divorced can invalidate your existing estate planning documents.
So you might think you’ve got documents covered and then they’re actually revoked by the fact of the divorce. So you don’t want to be really in either situation where they’re revoked and you’ve got nothing in place or what if you’ve got the wrong person in.
One thing that people may not be aware of is if they’ve left their assets to their kids their ex could be the financial controller of those assets.
That’s exactly right. So there’s probably not a lot you can do if your ex is going to have custody of the children if you pass away.
But you can take control of that situation and point someone else that you trust to actually manage the inheritance that you leave for the kids.
So the children will get the benefit of that money. But you can appoint who you want to make the financial decisions.
And also, for instance, pay fees directly on their behalf. To the school and that type of thing so that your ex doesn’t end up with control over that money and that money that you’re leaving your kids doesn’t get mixed up in any new relationships or new family with your Ex.
Oh, well that’s great. We’ve, we know there’s probably at least 10 reasons, but they a few of the more important ones.