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Newark Family And Estate Law Blog

Your spouse asks you for a divorce. Later that day, while you’re at home waiting for the kids to get back from school and your spouse is at work, you start wondering how you should approach this. Do you just tell the kids about the divorce by yourself as soon as they get home, or should you wait for your spouse?

There are a couple of things to consider here. As much as you want to talk about something this big in your life, you also don’t want to rush it. Never tell the kids that a divorce is coming before it is 100 percent certain. If your spouse just said it in the heat of the moment, you need to talk about it a lot more before breaking that news to anyone else.

Another thing to consider is that, even after you know that you’re getting divorced for sure, this is a conversation you want to have with the kids while you’re all together. It is best for both parents to be involved. Don’t try to do it before your spouse can participate.

The kids are going to have a lot of questions. This is an emotional time for them, as well. They need honest, accurate information. It’s easiest to meet all of their needs when you are together.

Remember that the kids’ best interests are the focus for much of the divorce process. That’s where the court puts the priority when deciding custody and other matters. As you proceed through the legal process, you need to continue to put the kids first.

Estate planning is an ongoing process, not something you do once and forget about. When major life events happen, like a spouse filing for divorce, you will want to revisit and update your estate planning documents to ensure they reflect your current wishes.

It is important to update estate planning documents during the divorce process to protect yourself and your end of life wishes. Forgetting to update these documents could leave your spouse in control of making decisions for your well-being, if something unexpected happens to you before the divorce is finalized rendering you unable to make decisions for yourself. Your spouse could even inherit your personal belongings or other personal assets that he or she may not have gotten in the divorce.

According to a recent Forbes article, the following are some estate planning actions you can take during a divorce:

  • Change your power of attorney. When married, you may have chosen your spouse as your agent in a medical power of attorney or a durable (financial) power of attorney. You will need to revoke any power of attorney that gives him or her control of your end of life decisions. You will also want to appoint someone else, like a responsible adult child, as your agent.
  • Update your will. Although you must be careful not to give away anything that is completely or partially owned by your spouse, you can alter what you would like done with the items you solely own. If this is not done and you die before the divorce is finalized, your spouse could end up with everything.
  • Find out what you can and cannot alter. Your spouse is likely the beneficiary on any life insurance, retirement accounts and pensions you may have. In most cases you will not be able to alter these documents until after the divorce is finalized, but it is a good idea to create a list of these assets now and form an awareness of what changes you are allowed to make and when you are allowed to make them.

Although there are several estate planning documents you cannot alter during your divorce, by updating what you can, you ensure you retain as much control as possible if you die or are incapacitated before the divorce is finalized. However, because estate planning is an ongoing process, you must also plan to revisit your documents after your divorce is finalized to make additional changes you might not be able to make now.

When creating an educational trust for multiple heirs — three grandchildren, for instance — people will sometimes elect to put all the money into the same “pot.” They just set up a general fund and all three heirs are allowed to take the money out and use it for college-related expenses.

This can work, and it is one of the simpler ways to craft an educational trust. It saves you from having to set up an individual trust for each person.

There are a few downsides, however. One of the main ones is that the shares each person gets may not wind up being equal, and this can create resentment. Feelings may get hurt.

For instance, imagine that one child does not go to college at all, but instead opts to start their own business. The other, wanting to stay close to the family, goes to a local community college. The third, focused on only the best possible education, flies across the country and goes to Yale.

It is clear that the heirs do not have the same needs. Should one child really get to pull Yale tuition out of that general pot, while the other pays for community college? Yale costs over $70,000 per year. Community college may cost just a few thousand dollars. Meanwhile, that last child doesn’t have any tuition costs and gets nothing.

This type of trust may also accidentally circumvent your actual wishes. Would you rather that each child got the same amount to use as they saw fit? Do you want to make sure that the heirs get along with each other and receive an equal inheritance?

These are important questions to ask, and it is critical to carefully consider all the legal options you have as you set up a trust as part of your estate plans.