Divorce Strategy: Estate Planning
If you are planning to file for divorce or have recently started a divorce suit, your divorce strategy estate planning lists cover periods before, during and after divorce. Why do so many of us wait until we are taking an overseas family vacation to update our estate planning documents? Statistically we are all at greater risk of injuries and death within a few miles of home or work. Every day we have something to lose and people relying on us, we should be responsible with our estate planning.
Considering filing for divorce? Divorce strategy and preparation should include estate planning document modifications and replacements. As soon as a divorce is filed, people react, and emotions are heightened. What happens to a spouse involved in a car wreck just days after they filed for divorce and sought full custody of the children? If the once beloved spouse with healthcare power of attorney rights is now the respondent in a divorce, what might they do?
The unthinkable and unlikely are possible. Dallas area divorce attorney Mark L. Scroggins frequently mentions the health and financial exposure in divorce. In creating specific case strategies for divorce and child custody clients includes estate planning strategy. Estate planning attorneys assisting divorce lawyers at Scroggins Law Group assures that clients are protected from exposure. If you do not have an estate planning attorney we can certainly suggest recommended referrals.
- Reviewing Premarital and Post-nuptial Agreements
It is a good idea to read any premarital and post-nuptial agreements with a focus on divorce, death and any other marital termination event. In Texas, these agreements can include a variety of terms and determinations of rights and duties not otherwise prohibited by law.
Of course, when reviewing agreements prior to filing for divorce, we are not likely to tip our hat to our soon to be opponent and modifications to existing agreements could backfire. Even if your document review does not lead to any actions, being aware of the contents in those writings are important.
Read our blog article: The Benefits of Prenuptial Agreements and The Peace of Mind they Offer a Marriage
- Trust Document Review and Amendment
If we are beneficiaries to trusts and we have the power of appointing downstream takers in a trust, we should be aware of how a divorce case could affect our rights to trust property. The first issue to address is whether we have the right to amend our trust. In Texas there are various types of trusts and agreements and reasons to form them.
If the trust document names family members of the soon to be ex-spouse, a trust modification can eliminate the potential for gain by others in the event something happens to us. While we do not expect in-laws and others to do wrong, we cannot discount how money can influence people.
- Insurance Policy and Employee Benefit Designations
Review the beneficiary designations on insurance policies and employee benefit forms with payable on death directives. Especially in high net worth divorce cases the insurance policies and employee benefit packages are complex. Wealth and security preservation strategy requires insurance and benefit plan strategy.
The Texas Family Code addresses ex-spouse beneficiaries of life insurance and whether policy provisions are effective after divorce. There are exceptions to a general rule former spouses do not take as beneficiaries after divorce. Depending on circumstances, we may choose to re-designate our former spouse as a policy beneficiary.
- Disinheriting Your Spouse During Divorce
Concerned about our wills and changing gifts to spouses requires us to discuss our existing wills with our divorce lawyer and estate planning attorney. To the extent a will can be revoked and amended without providing notice to beneficiaries such as a soon to be or currently former spouse, we might choose to disinherit the former spouse and others also named in the will.
Texas law grants a surviving spouse certain rights when a spouse passes away and the couple is still married, such as when they are not yet divorced. Nevertheless, we can designate another non-spouse to take our share of community property in our will.
- Creating a New Will and Revoking the Existing Will
Discussing divorce strategy and estate planning with our divorce lawyer and estate planning attorney we can plan to create a new will during the divorce or after the divorce. A new will created after the divorce may avoid questions of the will maker’s intent regarding a spouse. A new will effectively revokes any prior will.
- Medical Power of Attorney
A healthcare directive document also called a Medical Power of Attorney should be part of our divorce strategy estate planning. This document names an individual and the legal authority they have over your healthcare decisions in qualifying events. A qualifying event giving the other power to make decisions includes times when we are not awake during surgery, unavailable in a medically induced coma.
Estate planning changes before, during and after divorce should include healthcare directives such as the Medical Power of Attorney.
- Durable Power of Attorney
Like the qualifying events listed in a Medical Power of Attorney, inability to be present and able to legally act on our own behalf requires a Durable Power of Attorney to appoint another to act in our place. General Power of Attorney documents specify what authority the appointed person has and what events trigger that authority. We can grant powers of attorney to another, such as our spouse, to enter into agreements, sign checks and transact business on our behalf when unavailable.
Divorce strategy estate planning decisions among divorce lawyers and estate planning attorneys should consider what could happen if appropriate documents and designations are in place.
Call Scroggins Law Group in Dallas when you are considering divorce and have questions about estate planning and issues raised in this article. Scroggins Law Group is a family law firm and serves families in Dallas, Collin and Denton Counties. Mark L. Scroggins is Board-Certified in Family Law by the Texas Board of Legal Specialization. Call today (214) 469-3100.
Mark L. Scroggins and is team attorneys of at Scroggins Law Group advise and represent clients about issues in divorce where co-counsel is necessary to review and offer opinions and solutions to protect families and wealth with divorce strategy estate planning.