I think everyone in America will agree that the divorce process is not fun.
Even when people are in such an unhappy marriage that a divorce would be liberating, would unload a burden, and allow the person to start the next chapter of their lives where they can be happy, no one likes the process itself. Although the end result, the divorce, might be exactly what the person needs, everyone knows that the process itself is terrible. The legal landscape for divorce, especially in Massachusetts, is difficult, complicated, and cumbersome. It’s exhausting.
Celebrity divorce is no exception. We are inundated with news every day about another Hollywood couple that is ending their marriage. For example, headlines in recent weeks can’t stop talking about the Kim Kardashian divorce from Kanye West. Imagine having the ins and outs of your marriage splashed around the news. Here is a recent headline about Kim going back to her maiden name: Kim Kardashian asks to be declared legally single amid Kanye West divorce. For most of us “regular people,” we don’t have to deal with the paparazzi, but the divorce process itself is still mentally draining.
It’s even worse if you feel like you “lost” your divorce case.
For example, maybe you feel like you lost 50% of your assets. Well, would you rather it be 100%? That’s exactly what you could be looking at if you don’t update or create a new estate plan after divorce. At the conclusion of the process, when the divorced person finally feels that the heavy burden of the process has been lifted, they aren’t ready to dive back into a legal process and do more mental heavy lifting. They need to come to grips with the divorce itself, whether it’s liberating, or the opposite. Because of the mental currency that is required in the divorce process, people are often mentally fatigued at the end, and they don’t want to dig back into anything so heavy as estate plans.
That’s why the legal advice to a recently divorced person about updating their estate plan often falls on deaf ears. The person needs a break - a break from the legal process and how mentally taxing it can be, which is why they don’t want to deal with their estate plan right after. This is a big mistake, and it is made over and over again.
These people usually have good intentions, and hope to revisit an updated estate plan eventually, but it gets swept by the waste side and forgotten about. No matter how many times I try to explain this to people, they can just be too exhausted for it to sink in. Taking a little bit of mental energy and put it toward an updated estate plan, can avoid many many problems down the road.
What does a divorce mean for your existing estate plan?
Under the old rules, a divorce basically revoked an estate plan. That’s not the case anymore. Under the Massachusetts Uniform Probate Code, instead of the entire plan being revoked, the portions of the plan dealing with the ex-spouse are revoked and the rest of the document stays as-is. The problem with that is the rest of the document wasn’t created in a vacuum, and to look at it without the ex-spouse provisions often leaves the documents completely lacking, or completely useless.
Most people name their spouse as their power of attorney, their healthcare proxy, and their personal representative (formerly known as “executor”) under their Will. Smart people might also name a backup person. After divorce, that backup person becomes the primary, but now there is no backup person for the new primary. That means you’re only giving yourself an opportunity to name one person to act on your behalf, and if that person can’t do it, there’s nobody else named. The ending result is someone having to petition the court on your behalf, which is an extremely lengthy inexpensive process, that can be completely avoided just by updating your plan and naming a new backup person.
The situation can be even worse if you have children, and those children are under 18.
If you get divorced and you want your children to inherit from you if you die, but you don’t have a Family Trust in place, you are essentially giving all of your money to your ex-spouse. Look at it this way, if you die, in all likelihood your ex-spouse is going to have full custody of the children, and if the children are under 18, your ex-spouse will have full control over all money belonging to those children. So, if you die and leave all your money to your kids, but your ex-spouse has custody of those kids, you have essentially left all of my money to your ex-spouse to do with whatever they want. There is no guarantee that they will use the money for the kids, and instead they could use it to go on vacation with their new boyfriend or a girlfriend. Sound like something you want? I am guessing no.
The solution is to create a Family Trust for the benefit of your children, and you put someone else in charge of the money, someone of your choosing – that person is called a “trustee.” That way, if you die, the money must be used for the benefit of the kids, and you have chosen someone to oversee it, instead of just giving it all over to your ex-spouse to do with whatever they want. That Family Trust can make all the difference in the world, especially if your ex-spouse can’t be trusted with money or be trusted to use it for the kids’ benefit.
After the mental exhaustion of divorce, what kind of mental aptitude is needed to work on an estate plan?
Well, if you do your plan with us, we will make it easy. For example, a good estate planning firm is going to need information about all of your finances. If you think that means you have to spend time filling out forms and providing that info, you’re wrong. If you update your plan right at the conclusion of a divorce, your divorce attorney already has all of your financial information. You can authorize your divorce attorney to release that information to us, and you don’t have to waste any time filling out financial forms. The only thing you have to do is listen to our advice about how best to update your estate plan so that it achieves your goals. We do all the legwork and make the process easy. With our touchless legal services, you don’t even ever have to come to the office if you don’t want to.
Lastly, if your divorce attorney happens to be one of our referral partners, we waive our Strategic Planning Session fee for your first meeting with us. Please don’t wait on this – we have seen this go bad many many times. We have seen ex-spouses run through their children’s entire inheritance. If you just finished your divorce, reach out to us. The estate planning process, whether it is a new plan or an update to your old plan, is far less taxing than what you have already been through. We take care of most of the effort, and the result is well worth it. Don’t let your money be used to pay for a Mercedes for your wife’s new boyfriend. Make sure that money goes to your kids where it belongs. We can help you make sure it does.