If you have an existing estate plan, you are probably doing better than many of your neighbors. In fact, roughly 70% of Americans do not have even a will. Still, major life events, such as a divorce, often require updating an estate plan.
Here are three estate planning tasks you should tackle immediately after your divorce.
1. Revoke and replace your will
Your will is the foundation of your estate plan. The document outlines everything you own and describes what happens to your assets after your death. Still, following your divorce, your will may no longer reflect your true wishes. Revoking and replacing it may put your mind at ease.
2. Designate a new power of attorney
If you become incapacitated, a power of attorney allows someone to make medical, legal or financial decisions on your behalf. You probably do not want your ex-spouse to have decision-making authority over the matters that mean the most to you, though. If your ex-spouse is your current power of attorney, you may want to name a new one.
3. Update your beneficiaries
The companies that maintain your life insurance, retirement plans and bank accounts likely allow you to name a beneficiary to inherit funds upon your death. If your current spouse is your designated beneficiary, you probably want to make a change.
When you update your beneficiaries after your divorce, you are sure your valuable assets go where you want them to go. Reworking your will and naming a new power of attorney are equally effective ways to get your estate in order after the end of your marriage.