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Estate plan changes often overlooked after divorce

As is being widely reported, the divorce rate amongst the baby boomer generation has remained steady, even as the rate amongst other age groups has declined. Older people whose children are now out on their own are getting divorced, and states with large populations of older people, such as Florida, are affected by the trend. Because divorces are difficult and there are so many considerations, one important aspect that often gets short shrift is a divorced person's retirement and estate plan.

A couple's retirement plan is going to look much different than the retirement plan of a single person. While a couple may have had diversified types of retirement assets, say, a 401k and an IRA, the divorced individual is likely to have only one of these, or even just a partial interest in one or both. It would behoove everyone in this situation to go over what their plans are and possibly find a professional to advise them on the best way to rebuild their retirement portfolio.

At least as important, but also often put off until later, is one's estate plan. With all the pressures of a divorce, and the tendency to prefer not to think about one's own mortality, the will and other estate planning documents are placed out of sight and out of mind. However, these could be some of the most necessary changes to be made. Most couples have sweetheart wills in which they each leave their assets to each other. After a split, it is likely that the ex-spouse is no longer the intended heir. However, until the will is changed in a legally enforceable way, that is the situation. Further, healthcare proxies and powers of attorney need to be re-written so one's ex-spouse is not making decisions in case of one's incapacity.

Finally, Floridians should also check the beneficiaries of all their insurance policies or trust documents after a divorce. While it seems like a lot to remember, consulting an estate planning professional may be the best bet for divorced individuals to ensure that nothing is missed and an ex does not remain more a part of one's life than one wishes.

Source:, "5 Tasks to Help You Start to Rebound Financially Post-Divorce," Hank Coleman, April 29, 2014

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