When people divorce, one of the often overlooked items are such things as life insurance beneficiary designations, retirement account beneficiary designations and pay on death designations on financial accounts. These are not things that people deal with on a regular basis and therefore forget that the designations were ever made. If these issues are not addressed promptly and properly, a very unfortunate situation could erupt at your death between your family members and a former spouse.
Sometimes death and divorce sometimes nearly coincide. Time Magazine recently wrote an article titled “Facing Death and Divorce at the Same Time.” While focus was placed on Dennis Hopper filing for divorce from his current wife, while at the same time attempting to fight terminal cancer, a valuable lesson may be taken from the article – know what you have and speak with an attorney early. As the article states, spouses are normally not allowed to disinherit their spouse. Mississippi follows the same law, making it very difficult to prevent your spouse from receiving a certain portion of your estate. Of course, this becomes particularly important once a decision is made to divorce, as not too many people want their estate to go in part to a spouse that is in process of divorcing them.
The reason it is important to discuss estate issues with you lawyer as soon as you begin a divorce proceeding is that divorces take months, not days, to finalize. A husband and wife are often living completely separate lives, including with new significant others, while the finalization of the divorce is far away. A lawyer knowledgeable in the area of estate planning can walk you through some steps that will minimize the problems that would occur should you pass away during that period. If a divorce case is pending, you may be limited in what you can because of court restrictions. However, that does not mean that you can’t take steps to preserve as much of your estate as possible for your heirs. At minimum, you can come to a plan on what to do as soon as your divorce is final. You do not want your new wife to find out years later that the ex-wife that ran off with the pool boy just received all of your life insurance because you forgot to change the beneficiary designation.
Talk to your lawyer early and ask questions. Be aware of areas where you may have designated your spouse as beneficiary to an account or insurance plan. Finally, as soon as you are divorced, have a new Last Will and Testament prepared.