Estate Planning After Divorce: Protecting Your Assets from Your Ex

Few things are more emotionally trying than going through a divorce, especially when young children are involved. After the financial and child custody battles are over and the parties have arrived at a settlement agreement, you (hopefully) feel some relief that you can move on with your separate lives. What many divorced parents may not realize, however, is that their hard-earned money can end up back with their former spouse if they fail to implement an estate plan that prevents that from happening.

In most states, including New York, once a couple is legally separated or divorced, all references to the former spouse in the other spouse’s will, power of attorney, or healthcare proxy are nullified. You may not realize, however, that your ex-spouse can end up with control of your assets even if he or she is excluded from your will.

Here’s how this can happen:

Guardianship for Assets Left to Children. If you die while your children are minors, any assets left to them will be subject to a guardianship until they reach age 18. The court will entrust a guardian, most likely the other parent, with administering the assets for the children’s benefit. If you wouldn’t completely trust your ex-spouse to spend your money wisely, you should leave your assets to a trust for your children and designate a person close to you to make decisions about how the money is spent.

Incorrect Beneficiary Designations. Beneficiary designations are seldom nullified by separation or divorce. Therefore, if your ex-spouse is named as a beneficiary on a retirement account or life insurance policy, he or she will likely receive the proceeds if you died. For this reason, removing your spouse from beneficiary designations should be at the top of your to-do list.

If you don’t want your hard-earned money to end up in the hands of your former spouse, it is critical to revise your estate plan (or to create one) as soon as possible after filing for divorce. Divorce can be emotionally difficult for everyone involved. You can put your mind at ease through financial planning and by making sure your assets and children are protected if something happened to you.

About the Author

Shannon McNulty

Shannon McNulty is the founder of The Savvy Parents Group and founder of The Village Law Firm, which provides legal planning for parents with young children. Shannon received her J.D. from Georgetown University Law Center and her LL.M. in Taxation from NYU School of Law. She has also earned her CERTIFIED FINANCIAL PLANNER(TM) designation. You can learn more about Shannon and her firm at

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