Now that you have spent all that time and money making sure you received what you are owed from your marriage, it is time to protect your future finances.
After all of that divorce drama, do you really want your former spouse or his or her relatives to collect money at your death? Only you can take the steps necessary to ensure that this does not happen. And, if you and your spouse used the same attorney to divide up property during the divorce, you should use a separate attorney for your post-divorce protection, to avoid any conflict.
We suggest the following:
7 Basic Steps to Take after Divorce to Protect Your Individual Finances
- Make sure that all joint bank accounts are closed and all joint credit card accounts are terminated. This is very important as you would not want to be liable for post-divorce debts accrued by your ex-spouse. Make sure that you and your spouse are required to run credit reports prior to the end of the divorce process so that you can ensure every single account is covered. You may have long since forgotten about a store credit account opened and this could come back to haunt you. Six months after the divorce, obtain another credit report to ensure that all items have been covered. You have to be the one to make sure this happens.
- Change bank account beneficiaries. Check all of your accounts including bank, brokerage, retirement, college savings accounts, custodial accounts, life insurance, and etc. When opening such accounts you generally are required to name a beneficiary. Probate of your estate can be complicated enough without an ex-spouse trying to gain rights to your hard-earned personal assets.
- Draft a new Last Will and Testament. Make sure that your former spouse is removed and your assets are allocated to specific parties. If you are separated but not divorced, make sure that your will is updated and located in a place where your family members can locate it. This will ensure that your spouse (remember, if you are separated but not divorced you are still married!) does not recover under state law because your will is not accessible to your family.
- Update your health care proxy. You doubtfully would want your former spouse making healthcare decisions on your behalf after divorce or during the divorce. Once you decide the divorce is going to take place, the time is now to give your healthcare proxy to someone else.
- Update your Power of Attorney. Select a family member who can act on your behalf should you be unable. It is crucial that this document be updated as it can have serious consequences should you become disabled or unable to make decisions.
- Update your appointment of agent. This is the individual who is in charge of disposing of your remains after death. Do you want that to be your ex-spouse?
- Update all records. If you plan to use your maiden name or other prior surname, you can start by changing your driver license. Then you will also want to change your passport, social security card, and other identification cards.
At Keil & Siegel LLP we make sure to instruct our clients to delineate all such rights in the parties’ marital settlement agreement that we file with the court. That way there is some record of the divorce terms. Thereafter, we advise our clients to take proactive steps immediately to formally update these basic life documents.