We all know that going through a divorce process is extremely difficult. There are lots of things to think about and one of these is likely to be what you should do to protect your finances.
It is vital to have a suitably drafted Will in place to ensure that your assets pass according to your wishes in the event of your untimely death. If you die without a valid Will, the intestacy rules will dictate how your assets are distributed following your death.
If you are married without children, the intestacy rules state that your entire estate will pass to your spouse.
If you are married and do have children then your spouse keeps the first £270,000 along with all of your personal possessions. The remainder of the estate would then be divided in half, with one half passing to the spouse and the other half divided equally between the children.
A divorce is only legally finalised once decree absolute has been granted. If you were to die before this, without a valid Will, a substantial portion of your assets would pass to your spouse – this is not an ideal situation for most people.
This scenario can be avoided by ensuring your Will states who you want your assets to be passed on to. If you have young children, it is likely that a flexible Will containing some form of protective trust would be best for your family. The Will would appoint trustees to manage funds for your children on your behalf until they reach a certain age. It would also address who should be guardian(s) of your children in the event that you and their other parent die whilst the children are under the age of 18.
If you already have a Will which benefits your spouse, it would be wise to update this early on in the divorce process. It is not unheard of that someone will die whilst part way through divorce proceedings, with the unintended consequence of assets passing to their spouse.
Even once the divorce process is complete, it is important to be aware that divorce does not revoke a Will. It is much better to take control and prepare a new Will which clearly states exactly what you want it to do.
It is easy to push preparing a Will to the bottom of the (probably very long!) to-do list. However, as part of the divorce proceedings you will most likely be taking a closer look at your financial position. This is an important step in the process of making a Will, so it makes sense to complete this task t at the same time.
It can be difficult to know what sort of Will you want (or need) during the divorce proceedings when you do not know what your asset position will be at the end of the process. So, rather than taking the risk of waiting to update your Will, it is advisable to ask a solicitor to prepare a “holding Will” for you. This can put some very simple protections in place during the interim. The holding Will can easily be revisited once the divorce and financial settlement are finalised.
For expert advice on Will-writing and estate-planning, please contact Ollie and the team at Tyto Law on 01724 642 842 or by email on info@tytolaw.co.uk.