In the aftermath of a divorce there are a number of “cleanup” items to attend to in order to ensure that your newly single life will move along smoothly. While these things are often very far down on the list of priorities (keeping the kids fed and chauffeured are at the top of that list!), these items can be very important in the long run.
Very often newly divorced people put off attending to these details, then forget about them until disastrous results ensue.
Name Change
Some newly divorced women will change their name back to the one they used prior to marriage. The ability to resume using a former name is usually part of the final divorce decree, and you will just need to provide certified copies of that to the interested parties. Many times, mothers will not change their name back so that they will have the same last name as their children. This avoids confusion for the children, as well as for those in their schools and activities. It also means you do not have to attend to those particular loose ends.
However, if you do want to change your name, make sure you take care of all the places your married name showed up – drivers’ license, passport, bank accounts, retirement accounts, Social Security, school registrations, utility bills, health insurance policy, life insurance policy
Insurance Policies
All too often a newly divorced person forgets to change the beneficiaries on their life insurance policies. It makes things very difficult when a former wife suddenly receives a windfall from an insurance policy that was taken out during their marriage, especially if there is a current wife or additional children.
You may need to adjust your health insurance as well, removing a former spouse or now adding children to your policy.
And don’t forget to revise your auto insurance policies – the good part is that now that bill may be reduced.
Wills & Trusts
It is very important that any testamentary documents be changed as soon as possible. While the probate law in most states, including Florida, provides that a divorce will nullify a gift to a spouse in a will or trust, you don’t want to take the chance that the probate process will be delayed.
Bank Accounts
Many joint bank accounts are considered Joint Property With Right of Survivorship, and if something happens to you, the other party automatically owns the entire bank account. It is not enough just to take a name off the checks, make sure that you change the type of account that you own. Your bank will likely need a copy of the divorce decree, and possibly consent from your former spouse. It may take a joint trip to the bank to accomplish the change, and execution of documents.
Retirement Accounts/Pension Plans
Many retirement accounts or pension plans have a beneficiary attached to them. Make sure you change this beneficiary as well (unless the divorce decree has dictated otherwise). Some pension plans have a “pop-up” benefit for spouses, which means when the primary pensioner dies, the spouse is entitled to a certain amount for the duration of his or her life. The way this usually works is the pensioner takes a lesser pension amount during his or her lifetime in exchange for this benefit. This arrangement will need to be modified (again, unless the court dictates otherwise). The benefits or Human Resources department will help you with these changes.
In some cases, the plan for asset distribution requires that some or all of a 401(k) or retirement account may be rolling over to your spouse, and if so, there are documents that need to be executed to make sure that happens.
Florida Statutes Save the Day (Sort Of!)
Since 1951 Florida has had a statute in place that automatically nullified a gift in a will to an ex-spouse. In 1989 the concept was extended to revocable trusts. Since that time, estate planning has expanded to annuity accounts with beneficiaries, pay-on-death accounts, life insurance and retirement planning accounts, all of which are considered non-probate assets. Effective in 2012, there is automatic post-divorce nullification of a beneficiary designation of the former spouse for non-probate assets.
This post-divorce nullification of the former spouse as beneficiary only applies to the following beneficiary-designated non-probate assets:
- a life insurance policy, qualified annuity, or other similar tax-deferred contract held within an employee benefit plan;
- an employee benefit plan;
- an individual retirement account;
- a payable-on-death account;
- a security or other account registered in a transfer-on-death form; and
- a life insurance policy, annuity or other similar contract that is not held within an employee benefit plan or tax-qualified retirement account.
Further, the law does NOT apply in the following instances:
- to the extent federal law provides otherwise; (for instance, under ERISA)
- if the governing instrument as defined in the bill expressly provides that the interest will be payable to the designated former spouse after the order of dissolution or order declaring the marriage invalid and the instrument expressly provides that benefits will be payable to the decedent’s former spouse;
- to the extent the disposition of the assets are governed by a will or trust;
- if a court order required the decedent to acquire or maintain the asset for the benefit of the former spouse or children of the marriage;
- if under terms of the order of dissolution or order declaring the marriage invalid, the decedent did not have the ability to unilaterally terminate or change the beneficiary or pay-on-death designation;
- if the designation of the decedent’s former spouse as beneficiary is irrevocable under applicable law;
- if the contract or agreement is governed by the laws of another state;
- to an asset held in two or more names as to which the death of one co-owner vests ownership of the asset in the surviving co-owner or co-owners [i.e., joint accounts]; or
- if the decedent remarries the person whose interest would otherwise have been revoked as a former spouse under the bill and the decedent and that person are married to one another at the time of the decedent’s death.
So, while Florida law does provide some protection in the event these items are not addressed, it is not necessarily applicable in all cases. The lesson here is – take care of the business end of your divorce. If you don’t, it can complicate things immensely.
Final Thoughts
The last thing in the world you probably feel like doing is taking care of all this bureaucratic “stuff” but it is important that you cross all the t’s and dot all the i’s when divorcing.
Also, it is important that you not play games in getting these things taken care of – abide by the judge’s order and make sure the distribution of assets gets promptly achieved. Don’t make the other side go to court to enforce the order and don’t waste assets during this time – it can have unpleasant consequences, such as paying the other party’s attorney’s fees.
If you need help with accomplishing these things, an attorney experienced in family law can help you sort it out and tie up all the loose ends.