After a divorce, updating your estate plan is a crucial step to ensure that your assets are distributed according to your wishes and that unintended consequences are avoided. Estate planning documents often name a spouse as a primary beneficiary or grant them control over certain decisions. Once a marriage ends, it is important to revise these documents to reflect your new circumstances and protect your financial interests.

The most common element of estate planning that needs updating after a divorce is the will. Many individuals leave significant assets to their spouse in their will. Failing to amend the will after a divorce may result in property dispositions that do not align with the new family dynamic or personal preferences.

In California, as in most states, divorce automatically revokes any provisions in a will that name a former spouse as a beneficiary. Probate Code § 6122 states that, “Unless the will expressly provides otherwise, if after executing a will the testator's marriage is dissolved or annulled, the dissolution or annulment revokes … any disposition or appointment of property made by the will to the former spouse." That means your spouse’s interest, which is likely a substantial part of your estate, will pass to residuary beneficiaries or could fail entirely. Without proper updates, certain other provisions might become unenforceable.

In addition, you probably have appointed your spouse as your executor. This provision also will fail if you get divorced, so you must amend the will to name a new executor.

Consulting with an estate planning attorney will help ensure that the will is legally compliant and accurately reflects your post-divorce intentions.

Many estates involve assets that pass outside the will, such as life insurance policies, retirement accounts (like IRAs and 401(k)s), and payable-on-death (POD) accounts. These often require the designation of a beneficiary, which for married individuals is frequently the spouse. These beneficiary designations should be revisited after a divorce. Otherwise, these assets could still pass to an ex-spouse, since there is no statute terminating the beneficiary designations upon divorce.

Joint tenancies with rights of survivorship also should be carefully examined. If you own real estate or other significant assets as a joint tenant with your former spouse, they may automatically inherit full ownership upon your death. You may need to sever the joint tenancy and establish a new form of ownership to prevent this outcome.

Trusts are mechanisms for managing wealth and passing assets to future generations. Any trusts you have set up should be reviewed and possibly amended following a divorce. However, simply revoking or changing a spouse’s interest in a trust can lead to adverse tax consequences or unintended asset transfers. You might have created a Spousal Lifetime Access Trust (SLAT), which allows one spouse to benefit from the assets held in the trust tax-free while the other spouse retains control or ownership. If a spouse is removed from a SLAT, the estate tax loophole will be lost. A comprehensive review post-divorce with the assistance of an experienced estate planning attorney will ensure that any ex-spouse is removed as a beneficiary and that the trust functions in accordance with your current goals.

Favaro, Lavezzo, Gill, Caretti & Heppell, PC helps clients in Solano, Contra Costa and Napa counties prepare, establish and manage effective estate plans. To learn more, call us today at 707-674-6057 or contact us online to schedule a consultation.