When it comes to setting up an estate plan, there are many options, and there may be many factors to take into consideration. For example, if someone expects their marriage to end, they may be wondering how a divorce could affect their estate plan. Or, they may be unsure about which estate planning options are best as a result of their divorce. Sometimes, people have irrevocable trusts, and they may wonder how these estate plans will be impacted by divorce and whether their assets will be seen as marital property or separate property.
For starters, it is vital to carefully go over the unique details of your finances, your divorce and your trust. If you created an irrevocable trust prior to your marriage, assets in this estate plan may be protected from property division. On the other hand, if you set up an irrevocable trust during your marriage, the assets in this trust may not be seen as separate property and they may be viewed as marital property and subjected to division.
For some people, the divorce process can be especially tricky because of an estate plan, and it is paramount for you to know how your divorce will affect your trust (as well as other financial issues that apply to you). Although the financial consequences of divorce can be significant, those who are able to prepare for the end of their marriage by reviewing how their estate plan could be affected may be in a better position to handle what lies ahead.