Divorce is a complicated legal process with many financial ramifications. With so many immediate life-changing decisions to negotiate with your former spouse, it’s easy to push long-term planning to the back burner. This may lead to future will, trust, and estate disputes, especially if the marriage ends on less than amicable terms.
Here are some of the most common fiduciary disputes we have seen following divorce cases.
Outdated Beneficiary Designations
Many people designate their spouse as the primary beneficiary of their investments, retirement plans, insurance policies, etc. early in their marriage. Failing to change these designations after a divorce could put your former spouse in control of the assets you intended for your children, current spouse, and other loved ones. This opens the door for litigation.
If you are unsure who to name as the beneficiary of your insurance, retirement, and investment plans, consider naming your estate or revocable trust as the beneficiary.
You should also update your will and other important estate planning documents to ensure that the named beneficiaries are consistent with your wishes post-divorce.
Guardianship Disputes
Should you pass away while your children are under the age of 18, guardianship will most likely pass to the other parent. Courts will only appoint a guardian after your passing if the other biological parent is also deceased or deemed unfit (i.e., if the surviving parent has a drug or alcohol problem or other issues that make full-time parenting untenable). You may choose to attach a letter to your will expressing your concerns about the other parent’s guardianship of your children. This does not guarantee that your wishes will be carried out, but it will give the court something to consider if guardianship of your children is an issue after your death.
Powers of Attorney
Would you like your former spouse to have control over your medical and financial decisions if you become incapacitated?
The agent listed in any powers of attorney you executed could have control over your bank accounts, property, beneficiary designations, government benefits, and anything else not protected in a trust. Depending on the language of your power of attorney documents, they may be able to make decisions for you even if you are not incapacitated. Unless you trust your former spouse to exercise control of your financial and healthcare decisions, you should update your powers of attorney immediately following a divorce.
Have you found yourself in a will, trust, estate, or business dispute arising from a divorce? Contact us at 404.892.9797.
Gaslowitz Frankel LLC is Georgia’s premier fiduciary litigation law firm. Our legal team specializes in all aspects of fiduciary disputes, representing individuals, executors, trustees, investors, shareholders, and financial institutions in complex fiduciary disputes involving wills, estates, trusts, guardianships, businesses, investments, and securities.
