Updating Your Estate Plan After Divorce or the Loss of a Spouse

Updating estate plan after divorce or loss of spouse

Although not always thought of as a part of financial planning, estate planning is a crucial aspect of financial management, ensuring your wishes are carried out effectively.  Life changes such as divorce or the loss of a spouse necessitate careful review and updates to estate plans.  The term estate plan broadly covers your will, any trusts and beneficiaries on any financial accounts.

The end of your marriage changes many things.  Even if you had a will or trust in place during your marriage, it likely won’t make sense anymore given your change in circumstances.  Although it’s probably not the first thing you want to deal with, it is important to ensure your estate plan aligns with your current needs and wishes just in case something happens to you.

Key Components of Updating an Estate Plan

Your estate plan generally refers to your will, any trusts, and other legal documents that relate to your death or incapacitation.  In many cases, married people tend to set up their wills to leave everything to their surviving spouse and to name their spouse as their power of attorney and healthcare proxy.  Since you no longer have a spouse, you obviously need to change who will receive your assets, but also who can act on your behalf if you are no longer able (this is done in the power of attorney and healthcare proxy).

In addition to updating these documents, be sure to revisit the beneficiaries on any financial accounts you have, like your 401k, IRAs and life insurance policies.  The beneficiaries on these accounts trump anything that is stated in your will and assets move straight to the beneficiary without requiring a probate process.  If you previously listed your ex-husband as the beneficiary on these accounts, be sure to change it or he will get that money if anything happens to you.

You also need to think through guardianship for minor children if necessary, considering suitable guardians.  As a single parent, if something should happen to you, you want to ensure that you have a plan for your children.  This can be one of the most difficult areas to address, but if the worst happens you will be glad that you did.

Finally, if you have a trust in place, be sure to review the beneficiaries and the asset distribution to make sure that it still makes sense.  Depending on your financial situation, a trust may be a strategic tax vehicle so make sure you understand how things change now that you are single.

Communicating Changes Effectively

Since estate planning documents are legal documents, it is always advisable to work with an attorney when drafting and updating them.  A reputable estate planning attorney will not only help you draft the required documents, but also advise you on your options and help you avoid any pitfalls. 

Once you have the updated documents in place, you want to communicate the relevant changes with the important people in your life.  Let your family know of your wishes, to avoid confusion or disputes.  Also be sure to inform the executors and trustees of their roles and responsibilities.

Move Forward with Confidence

There are many things to think about as a newly single woman.  Embrace life changes by proactively updating your estate plan to reflect your current circumstances.  It’s not the most glamorous task, but you can secure your legacy by ensuring your estate plan accurately reflects your wishes.  Taking this step will allow you to move forward with confidence, knowing that your estate plan is up-to-date and aligned with your goals.

Updating your estate plan after divorce or the loss of a spouse is a critical step in ensuring your financial affairs are in order. By understanding the impact of life changes, addressing key components of estate planning, and communicating changes effectively, you can navigate these transitions with confidence and peace of mind.

Sara Zuckerman, CFP®, CDFA® is the founder of Reset Financial Planning located Scottsdale, AZ and serving women across the country with a focus on helping women who find themselves suddenly single in mid-life, align their financial resources with their values to plan for the next chapter of their lives.

 

If you are interested in learning about how I can help you take charge of your finances as a newly single woman, please contact me at  or schedule a free 20-minute consultation.

 

Sign up for Reset FP’s Monthly Newsletter to effortlessly stay on top of my weekly blog posts and occasional extra goodies and receive my Get Your Finances Organized Checklist for free!

 

Disclaimer: This article is provided for educational, general information, and illustration purposes only. Nothing contained in the material constitutes tax advice, a recommendation for purchase or sale of any security, or investment advisory services. We encourage you to consult a financial planner, accountant, and/or legal counsel for advice specific to your situation. Reproduction of this material is prohibited without written permission from Reset Financial Planning, LLC, and all rights are reserved. 

Crafting Meaningful Thanksgiving Traditions in a Time of Transition

As we kick off the holiday season with Thanksgiving, it’s only natural to think about tradition.  For so many of us, the holidays and related traditions are linked with memories going back to childhood.  And if you are newly single, it can be a time that brings sadness and grief about how life used to be.  But it can also be an opportunity to create new traditions or focus on those traditions you cherish the most while letting others fall by the wayside.

Thanksgiving Memories from Childhood

For me, Thanksgiving dinners growing up were never very large affairs.  In fact, most of the Thanksgivings I remember were only three people, my brother, myself and whichever of our parents was entitled to Thanksgiving on the custody calendar for that year.  Our grandparents, aunts, uncles, and cousins lived all over the US and travelling to see any of them was rarely in the cards.  So, we had small Thanksgiving dinners at home, with just the three of us.

While it may not have looked like the Thanksgiving you see on TV, when I think of holidays and family and tradition, I think of Thanksgiving.  It’s my favorite holiday and one that I look forward to with anticipation for weeks beforehand.  I love cooking all of the traditional foods that I remember from my childhood.  The stuffing I make is my mother’s recipe and something about the smells of the butter and onions sautéing for that stuffing early on Thanksgiving morning takes me right back to my childhood.  I also set the table with her China, just as she did.  It’s the one time a year that I bring out those special dishes and I am always a bit anxious with my rambunctious boys running around, but it just wouldn’t be Thanksgiving without them on the table.

Now that I have my own family, I cherish being able to create these memories for my children.  And I know that they are developing the same connections with the holiday and the food that I have.  This year, as I was putting together the menu (which is basically the same every year), I suggested that perhaps we try a different dessert.  Not because I don’t love what we usually have, but because I have been seeing lots of new recipes that look good, and I always enjoy trying new recipes.  But that idea was quickly discouraged.  To them, Thanksgiving is synonymous with apple pie and pumpkin pie and anything else just won’t do.

Creating New Traditions in a New Season

Change is hard, especially during the holidays.  Rather than letting it get you down, use this as a time to reflect on how far you have come.  Maybe you are in a different place than you imagined at this point in your life.  But think about what you have accomplished that you are proud of.  You have likely had to learn new things, take on new challenges and develop independence.  None of that is easy and you should be proud of yourself for how far you have come.

It’s also a time to reflect on your values and priorities.  What holiday traditions do you love?  And which can you live without?  Are you tired of spending Thanksgiving with your second Cousin Phil, who kind of creeps you out?  Maybe it’s time to change that.  Are there things you loved about the holidays as a child that you didn’t get to recreate during your marriage?  Take this opportunity to revisit and revive those traditions as you create new memories for yourself and your children.  Be a little bit selfish and create the holiday season that makes you feel joy at this time in your life.

Another way to bring more joy to the season is to incorporate your personal passions.  Love spending the day in the kitchen cooking an entire Thanksgiving dinner?  Then do that.  But if what you really love is baking, then volunteer to make the pies or other treats while someone else does the turkey.  And if cooking isn’t your jam but you love creating art, then find a way to bring your artwork to the meal and leave the cooking to someone else.  By finding a way to focus on your passions, you can find your joy.

Embracing Gratitude & Connection

Thanksgiving is also a time to embrace gratitude.  The holiday is all about giving thanks for what we have.  It’s a great reminder to reflect on what you are grateful for.  Even if life has thrown you some curveballs this year, there are still things to be grateful for.  Whether its health or family or sweater weather or Pumpkin Spice lattes, this season offers so much to enjoy.  Don’t let the little things go unnoticed or unappreciated.  Focusing on gratitude can be a great way to help you get through tough times.

This can also be a time to nurture relationships.  Whether it’s spending some quiet time with your kids or reconnecting with friends and family that you haven’t spent as much time with as you would like.  The holidays create an excuse to reach out and connect.  Lean on those around you for support as you seek to rebuild your traditions.

Reflecting Back and Looking Forward

As I start to prepare our Thanksgiving dinner this year, I can’t help but reflect back to all the memories this holiday carries for me.  Cranberry sauce, mashed potatoes, turkey and all the pie.  The food is a big part of it.  But beyond the food, it’s family.  It’s traditions and memories that take me back to my childhood and that I hope my children carry on to their children. 

So, if your Thanksgiving looks and feels different this year, it’s ok to be sad about that.  But it is also ok to create new traditions.  Or to dig out old traditions and start them anew.  Your holidays don’t have to look like a Hallmark channel movie, they can look like whatever brings you joy.  If that is spending all day cooking a turkey and stuffing and sweet potatoes, great.  If that is going to a friend’s house and just bringing the wine, then that is fine too.  You get to decide how you spend your day and the memories that you create.

If you are interested in learning about how I can help you take charge of your finances as a newly single woman, please contact me at  or schedule a free 20-minute consultation.

Sign up for Reset FP’s Monthly Newsletter to effortlessly stay on top of my weekly blog posts and occasional extra goodies and receive my Get Your Finances Organized Checklist for free!

Follow my YouTube channel for weekly videos covering a range of topics that will be helpful to you as you start to take control of your finances and adjust to your new normal.

Navigating Mid-Life Transitions: Choosing the Right Financial Advisor

Finding yourself unexpectedly single at mid-life creates countless challenges. For many women, there are several financial questions that arise, and they consider hiring a financial advisor. Having a knowledgeable and trustworthy advisor by your side can make a significant difference in navigating your financial future. It can be a great decision if you find the right professional.  Today, we will discuss three key considerations when looking for a financial advisor to guide you through this time of transition.

Expertise & Specialization

First and foremost, you will want to seek out an advisor who specializes in handling divorce or widowhood. There is an emotional component to your situation that goes beyond a typical investment allocation conversation. Just as you wouldn’t go to a heart surgeon for a knee problem, hiring an advisor who primarily focuses on retirement planning may not be the best fit for you at this time.

Additionally, if you were not the primary financial manager during your marriage, you will want someone who can educate and empower you as you move forward. Even if you and your spouse previously worked with an advisor, that advisor might be more of a generalist and may not have the experience to help you with the emotional side of your transition.

For many newly single women, this is the first time they are meeting with a financial advisor.  It can be an intimidating experience.  There is a lot of industry jargon and if you aren’t familiar with it, you may not understand what is being discussed.  By seeking out an advisor that specializes in working with women like you, you are more likely to find someone who will partner with you and educate you so that you can feel more confident in your financial situation.

Trust & Compatibility

The second crucial consideration is compatibility. You should feel comfortable sharing personal financial information and discussing your goals and concerns openly. Seek an advisor who demonstrates empathy, active listening skills, and a genuine interest in your well-being.  You want to know that your advisor understands your priorities and is listening to your concerns. 

It’s also important to ensure that your advisor is a fiduciary, meaning that they are obligated to act in your best interest.  Unfortunately, not all advisors operate to this standard.  Many advisors, especially those at large brokerage and insurance companies, are only required to show that products they sell are suitable for the investor, not necessarily in their best interests.  This is where organizations like the National Association of Personal Financial Planners (NAPFA) or the Certified Financial Planner (CFP) Board can be helpful because their members are required to operate under the fiduciary standard.

In addition to using the organizations above, consider asking for referrals from friends, family, or professionals in your network.  Ask around and find people who have had positive experiences with their financial advisors. Don’t hesitate to meet with multiple advisors to find someone you connect with on a personal level.  And don’t feel pressured to make decisions or commitments before you are comfortable.  This relationship will play a crucial role in your financial journey moving forward.

Fee Structure & Transparency

Lastly, it’s essential to consider the fee structure of a financial advisor. Different advisors have varying fee structures, ranging from commission on the sale of products to fee-for-advice models. Take the time to understand how the advisor charges for their services and ensure it aligns with your preferences and financial goals.

Advisors who receive commissions need to sell you a product to get compensated.  Whether that product is a mutual fund or an insurance policy, their focus will be on getting you to buy the product.  They may be less focused on whether the product is the best solution for you and more focused on closing the deal.

Fee-only advisors, on the other hand, are paid directly by their clients and not for the sale of products.  This means that you will have to pay them directly for their advice, but also that they are generally more focused on finding the right solutions for you rather than getting you to buy a specific product.  They are also more likely to help with a wide array of financial planning topics like cash flow, estate planning and taxes, in addition to investments.

A transparent advisor will provide clear explanations of their services, fees, and the investment options available to you. It’s important to have a complete understanding of the financial relationship you’re entering.  Ask questions about what is included as well as what is not.  And if the service model doesn’t fit what you need, know that there are many other types of advisors and models out there.

Conclusion

Hiring a financial advisor to help you navigate your new situation can be one of the best decisions you make.  As long as you find the right advisor for you and your current needs.  When selecting a financial advisor to help you transition after loss of your spouse, consider:

  1. their expertise in working with women like you,
  2. their compatibility with you and your style, and
  3. their fee structure

By carefully evaluating these factors, you can find an advisor who not only understands your unique circumstances but also provides the guidance and support needed to help you move forward confidently.

Remember, this decision is crucial for your financial well-being, so take your time, ask questions, and trust your instincts. Finding the right financial advisor can be a powerful step in taking control of your financial life during this significant transition.

If you are interested in learning about how I can help you take charge of your finances as a newly single woman, please contact me at  or schedule a free 20-minute consultation.

Sign up for Reset FP’s Monthly Newsletter to effortlessly stay on top of my weekly blog posts and occasional extra goodies and receive my Get Your Finances Organized Checklist for free!

Follow my YouTube channel for weekly videos covering a range of topics that will be helpful to you as you start to take control of your finances and adjust to your new normal.

Thriving After Loss: Three Stories of Resilience

Life’s unexpected turns can challenge even the most carefully laid plans. For women, losing a spouse can bring profound changes, including those that ripple through financial strategies. Below are the inspiring stories of three women who faced unforeseen tragedies in their fifties and found the strength to reshape their financial paths. Each story underscores the importance of reevaluating priorities and adapting strategies, offering valuable insights for women navigating similar journeys.

Rediscovering Independence and Dreams

Jane and Roger retired to Oregon with dreams of a peaceful cabin life. They both spent their careers working in tech in Silicon Valley and were looking forward to a simpler existence. Thanks to being diligent savers and investors, they were able to retire in their 50’s and were planning for a long retirement.

Unfortunately, the universe had different plans. Roger was diagnosed with pancreatic cancer and passed just a few months after their move. Jane was devastated. They had worked so hard for all their lives and had been imagining their cabin in the woods for years. Would she be able to continue with the plans on her own? Or would she need to plan a new future?

Inexperienced with their investments, Jane faced the daunting task of understanding their financial landscape. Fortunately, Roger planned well, and things were as organized as they could have been. This allowed Jane to combine assets seamlessly and feel confident that the nest egg would allow her to follow their dream and continue building the cabin.

Where she was less confident was in managing the investments going forward. She needed her funds to last another forty or fifty years and she did not want to make a mistake that would put her future at risk. She decided to hire a financial planner to help her with the investment management. We worked to craft a strategy based on her new circumstances. She decided that her earlier strategy was too risky and based more on Roger’s risk tolerance than on her own. We repositioned her accounts to fit with the new situation. Every time we meet, she expresses her gratitude for taking a huge burden off her shoulders.

The cabin in the woods is still under construction, and Jane is looking forward to moving in as soon as she can. She still misses Roger all the time, but she has rediscovered confidence in her independence.

Crafting a New Life Beyond the Shoreline

Lisa and Steve cherished their beachside life in South Carolina until Steve’s sudden passing forced Lisa to reimagine her future. They had been vacationing at the beach in South Carolina for years, so when Steve retired from his job running a manufacturing company outside Philadelphia, they were thrilled to move there full time.

One day, about a year into their dream retirement, Steve had a heart attack on the golf course. Lisa’s world was turned upside down. She had always relied on Steve as the primary earner and financial manager. She had no idea what she was going to do without him. Their plan was to spend many years enjoying the beach and all that retirement had to offer.

As she adjusted to the initial shock, Lisa began to rethink being in South Carolina. While she had friends there, and she and Steve enjoyed it together, she didn’t have any family in the area. Her daughter was working in Washington DC, while her son and her first grandchild were in Colorado. Lisa began to contemplate what it might be like to move closer to one of her children. Her first thought was to move to Colorado as her son was more established and more likely to stay there long term. And of course, that would allow her to spend more time with her grandchild. But what would it look like?

She had no idea if she could afford to buy a new house if she sold the condo which was mortgage free. Lisa was also considering different options, from buying in a 55+ community to partnering with her son to help him buy a bigger house with an in-law suite where she could live. She had several ideas but didn’t know where to start in analyzing what was feasible.

As a first step, Lisa and her son decided to reach out for some professional guidance. I worked with them to analyze the three scenarios and create some guidelines for what a reasonable purchase budget would be. We then compared the long-term impact of each of the scenarios so that she felt comfortable that she wasn’t making a mistake that would put her financial future in jeopardy.

Armed with the new financial plan, Lisa gained the confidence to shift directions and move to Colorado to be closer to family. She is thriving living near, but not with, her son and grandchild. While it’s not the life she had envisioned she is incredibly happy and content where she is now.

Transforming Grief into Purposeful Renewal

April and Jeff had been married about ten years. One afternoon, April got the call no one ever wants to get. Jeff was driving home from work when he was in a car accident. April went into shock. How could this happen? They were so young, they had so much they wanted to do. How was she going to move forward?

It took months for April to come to terms with what had happened, and to even start to think about what it would mean for her future. She was only 52. April had been a homemaker, supporting Jeff and his demanding career, for the past ten years. She felt like she was too young to retire, but without Jeff to care for and support, her days weren’t filled anymore. She wanted a reason to get up in the morning, something to focus on. Confronting grief, April realized the need for purpose and decided that she wanted to reenter the workforce.

She had been out of the workforce a long time, but maybe she could find work that she would enjoy.  She researched her options for almost a year, and during this time sought out help from me.  Not only did she want to understand how this plan might affect her finances, but also needed a thinking partner to help in vetting the options. She ultimately decided to go back to school to become a paralegal.  By using a part of Jeff’s life insurance, April invested in herself, embracing education and forging a new career.

In addition to giving her purpose, this new career and the income it provided significantly improved April’s financial plan.  She could have survived on the retirement savings and life insurance that Jeff had left to her but there wouldn’t have been much room in the budget to enjoy life. With the new career, she has discovered a love of travel and is able to take several trips a year. She is also adding to the retirement savings so that when she does finally retire, she will be able maintain the lifestyle that she is so thoroughly enjoying.

Three Paths Forward

The stories of Jane, Lisa, and April highlight the incredible resilience of women in the face of unexpected loss. These narratives offer valuable lessons in adaptability, reevaluation, and the power of seeking professional guidance.

If you find yourself navigating similar circumstances, remember that there’s no single right way to move forward. By partnering with a knowledgeable financial advisor who understands your unique challenges, you can chart a course that aligns with your values and aspirations. The loss of a spouse can be a catalyst for profound change, giving you the opportunity to rebuild not just financially, but emotionally and personally, as well.

As you consider these stories, reflect on your own journey and the support you have at your disposal. Whether it’s aligning investments, exploring new career paths, or crafting a sustainable retirement plan, your financial planner can guide you toward a future that’s as empowering as it is unexpected. Embrace the resilience within you and take each step forward with the knowledge that you’re not alone on this journey of renewal.

Make Sense of Your Financial Life After Losing Your Spouse

Losing spouse mid-life is rarely part of the plan. In addition to grieving the loss of your partner, you are faced with a myriad of financial decisions that can add to the stress:

  • Maybe you are considering selling your home to downsize or move closer to family for support
  • Or you are contemplating going back to work after an extended period caring for children or considering a career change into something that is better suited to your newly single status
  • There may be life insurance proceeds that you need to manage, and decide how to best leverage as you move forward

How can you possibly make all of these decisions while also dealing with all of the emotion of this difficult time in life? Having a framework to leverage can be a helpful starting point. I recommend that all of my clients follow a four-step process:

  1. Reorganize your financial life
  2. Reassess your financial priorities
  3. Reimagine your future
  4. Realign your resources

Using this framework can give you the confidence you need to move forward into the next chapter and take control of your financial situation in the process.

Get Your Financial Life Organized

The first, and probably most important, step to take is to get organized. In most couples, there is typically one partner who takes more ownership of the finances. If that was not you, you may not even know where all of the accounts are, or what the logins are for the various institutions. So, you will need to use statements, tax returns and any other records you may have in order to try to find all of your accounts. You will then need to work with each firm where you have accounts to have the accounts switched into your name alone (hopefully you are listed as beneficiary on any accounts that were only in your husband’s name as this will speed along the process). Once all of the paperwork is complete and the accounts are titled in your name, you can begin consolidating them, or moving them all to one firm. While this is not a requirement, it will make your life much easier going forward. You will only need to remember one login, and it will be much easier to see and manage your full financial picture. And don’t forget to update beneficiaries on any existing or new accounts so that they go where you want them to if anything should happen to you. Along those same lines, you will also need to draft a new will (especially if you have minor children).

Do You Have the Same Priorities Since You Lost Your Spouse?

Once you have things organized and have a good understanding of what you have, the next step is to reassess your financial priorities. Prior to this transition, you and your late husband probably had financial goals that you were working towards together. But do those goals still make sense in the new reality? Does money you were saving for a dream vacation now need to be used to keep paying the mortgage while you get back into the workforce? If you were a two-income household, what now needs to change so that everything works with just one income? You need to consider both short- and long-term goals. While the shorter-term needs might feel most pressing, you can’t lose sight of the longer terms needs like retirement and the kids’ college. Some things that used to be a priority might not seem so important as you adjust to the new normal.

Let Your Values Drive Your Vision for the Future

Armed with a good understanding of your financial situation and list of your priorities, you can begin to reimagine your future based on what you value most. When creating a financial plan, one of the most important things a person can do is really define their values. The first time I was asked what I value most in life, I couldn’t answer the question. It took me a week of pondering (and Googling lists of values) to really understand what my values are (and why trying to force myself to do things that aren’t aligned with my values creates frustration and disconnection in my life). So, spend some time thinking about what your values are, write them down and keep them handy because when you need to make financial decisions it is much easier when you know which decisions are in line with your values and which are not. For example, if your primary value is time with family, and you are offered a job with a big paycheck that seems like it will solve all of your financial worries but it requires you to be on the road (and away from your family) 75% of the time, then it probably isn’t the right answer for you. Using your values as the center point, you can start to create a vision of the kind of life that you want to create for yourself. Having a clear picture of where you want to go is the first step in moving forward.

Realign Your Resources with Your Vision

Finally, once you have a vision for the future, you can realign your resources to help you get there. While your financial resources are obviously a part of this equation, you also have to think about how you want to use your time and energy. Together your money, time and energy are your human capital and they are the three resources that you have to help live the life you want. Whenever you need to make a decision on how to spend your time, money or energy, think back to your values and if spending the time/money/energy will bring you closer to your values or move you further away. When you are making decisions that bring you closer to your values, you will be happier and more fulfilled in life. And you deserve that.

While none of this is easy, using this framework can give you a good place to start. And if you want support or help along the way, feel free to Schedule a Call so we can talk.