During a Florida divorce, most couples spend a significant amount of time and effort determining which party will retain which assets. Property division is an important aspect of the divorce process, and one that will have a great deal of impact on the years ahead. However, there is an extra step that spouses should take to ensure that their former partner does not gain access to certain assets. This family law matter is linked to estate planning, and should be addressed during any divorce.
When it comes to inheriting wealth, simply ending a marriage is not always the end of the financial links between a husband and wife. Drafting a will that leaves all assets to one or more other individuals is also not sufficient. In cases in which a former spouse remains listed as the beneficiary on certain accounts, those funds will pass on to that individual, regardless of what it may say within one’s will or divorce agreement.
The issue is one that has an impact on many couples, often due to the fact that individuals tend to have a wider range of financial accounts than in decades past. By the time an individual reaches retirement age, he or she may have amassed a mix of retirement and investment accounts, pensions and life insurance policies. All of these accounts require a named beneficiary, and most people complete that paperwork and then give the matter no additional thought.
This can result in a situation in which a former spouse receives an unintended inheritance, while one’s current spouse and children could be left without assets that were intended to pass down to them. Loved ones can be left with a nasty surprise in the aftermath of their loss, and have very little means of recourse to correct the problem. When it comes to estate planning and family law, a review of one’s beneficiaries should be part of every Florida divorce.
Source: wealthmanagement.com, “Error in Planning Can Benefit the Ex-Spouse”, June 1, 2015