What impact will divorce have on your estate plan?
Nevada is one of nine community property states. That means, if you get divorced in Nevada, the assets acquired over the course of the marriage are regarded as community property to be equally divided, unless there is clear and convincing proof to the contrary. Likewise, debts acquired during the marriage are presumed community debts.
While an even split is the idea, often the division of complex assets requires careful analysis and negotiation to reach a fair settlement, and the outcome may not be a 50-50 split. With that in mind, it is important to understand the potential long-term consequences of property division and how divorce will affect your estate plan.
Most people know that a will is the foundational estate planning document, but in complex estates, other documents may have more controlling power than a will. For example, if you don’t update your beneficiary designations on insurance policies and retirement accounts after divorce, then those aspects of your estate plan may override what you’ve said in your will.
In some cases, ex-spouses rather than current spouses or children have received retirement and insurance benefits. The main thing to understand is that your estate plan doesn’t automatically update. You have to take steps to make your plan reflect your new situation after divorce. This is particularly important, too, if your estate plan includes a trust.
The reality is that Americans these days are living longer than ever before, and even if you divorce at an older age, your retirement plans are likely to be significantly affected. Work with an experienced property division lawyer to ensure that your financial future is protected after divorce.
For more on these matters, please see Kainen Law Group’s overview of asset division and property settlements.