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Changing an estate plan during divorce

On Behalf of | Nov 13, 2017 | Firm News, Trusts |

It is important for people in Ohio who are getting a divorce to keep their estate plans in mind. It may be necessary to make changes as soon as possible in order to ensure that their wishes are carried out. Otherwise, if a person dies unexpectedly, a spouse or soon-to-be ex-spouse may receive a large share of that person’s estate.

For example, a man in Arizona received a large settlement after an accident. Initially, the man and his wife signed a prenuptial agreement to ensure the settlement, which was in a trust, remained his property. However, the man eventually signed 80 percent of the trust over to his wife and 20 percent to his family. Later, his wife filed for divorce. At that time, the man only needed to speak to his attorney and sign an amendment for the trust to ensure that all the money went to his family. However, he did not, and he died two days before the divorce decree was filed. As a result, the man’s wife got $14.4 million and his family only got around $3.6 million.

In another case, the man did not do paperwork on retirement plans immediately. He then died on his honeymoon, and this meant new orders had to be prepared. When a person files for divorce, changing the estate plan should also be a priority.

Even if a person does not divorce, an estate plan, including trusts should still be reviewed regularly. Other changes in the family, including births, deaths and marriages, may require changes in the estate plan. A person’s assets or the wants and needs of family members may change as well. The person may also want to discuss the estate plan with family members so they understand its intentions. This may make them less likely to challenge it.

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