The Ink Is Dry on Your Divorce, But Is Your Estate Plan Still Protected?

Finalizing a divorce often brings a huge sense of relief. You’ve divided the property, sorted out all of the logistics, and received the decree. It should feel like a burdensome chapter of your past life is finally being closed. However, there is a crucial, hidden vulnerability that most people overlook: your estate plan.

If you have an old will, power of attorney, or life insurance policies floating around from your marriage, your divorce decree will not  automatically change them. Leaving your estate plan on cruise control after separation can lead to your assets, medical decisions, and ultimately your legacy in the hands of the person that you spent so much time and money trying to distance yourself from. 

Most assume that once the marriage is over, that their old legal obligations are also over. However, in North Carolina, nothing automatically changes in your will until the judge signs the final divorce decree. 

Even before the divorce is granted, you should consider making changes during separation. Though it is proposed to change, North Carolina still requires an entire year of separation before one can file for divorce. If you were to pass away during this time without updating your estate plans, you could be handing over your entire estate, with or without a will. Consequently, updating your estate plan can protect you during this transition. 

Possibly the most unsettling risk of leaving your estate plan untouched during the mandatory one-year separation period is the statutory “year’s allowance.” Under North Carolina law, a surviving spouse has the right to claim a financial support allowance of $60,000 from your estate’s personal property following your passing. Regardless of what your will says, this right exists. Even if you write your spouse out of your estate plan during separation, they have a legal claim to $60,000. North Carolina grants this protection automatically to any legal spouse, unless there is a valid, notarized prenuptial, postnuptial, or separation agreement that is in place to waive it. Without one of these protective documents, your ex spouse could leave the relationship with an enormous piece of your assets.

Many people think that because their divorce is final that it automatically cancels any provisions that will benefit their former spouse. This is technically true, but leaving it can be a gamble for two main reasons: 

1. Without a clear and updated plan post-divorce, the courts may treat your ex-spouse as if they’ve passed away before you. That part of your estate can be determined by the state’s intestate succession laws, and possibly be given to your former in-laws or even stepchildren. The automatic revocation that is applied to your spouse is hardly ever applied to your ex’s family that you may have included, so those provisions for them will stay in tact. 

2. A will only handles probate assets, and generally does not handle nonprobate assets. This includes trust assets, any accounts that have beneficiaries, and even property that is held jointly. You must contact any providers to update documents like life insurance policies, retirement accounts and 401(k)s, and payable on death and transfer on death accounts. 

We get it. After crossing the finish line of a divorce, the absolute last thing you want to do is stare at more paperwork. You’re just ready to be done. Leaving your estate plan on cruise control means leaving your future, and your assets, in a potentially vulnerable position. Taking a few more final steps now ensures that your hard-earned legacy actually goes to the people you love. Let us handle the heavy lifting. Contact Aligned Advocates today, and we’ll make sure that all of your assets are fully protected, and your estate plan finally reflects your fresh start!

Article written by Stephoni Minter. Stephoni Minter is a rising second year law student at North Carolina Central School of Law. Stephoni is particularly interested in the intersection of law, innovation, and community impact, and she hopes to use her legal career to help create opportunities for future generations of creators and entrepreneurs.