Understanding the Importance of Estate Planning During Divorce

When you’re considering or going through a divorce, it affects almost every aspect of your life. Some of those aspects are obvious: your budget, your schedule, your living arrangements, etc. One area that is often missed during divorce, however, is the importance of updating your estate plan.

Often, we think of estate planning as something that relays your wishes for what will happen after you die. While it does do this, it also does a lot to protect your family, your legacy, and your assets. Your estate plan can affect your taxes, protect your business, make sure your medical wishes are followed, and ensure that your children are cared for by the people you choose if you’re incapacitated (rather than leaving that choice up to the state).

At Diamond Legal, our estate planning team works with our family law team to make sure that the details of both your divorce and your estate plan are taken care of so that you can focus on what really matters: protecting your family and building your new life.

Strategies for Safeguarding Your Assets Before and During Divorce

There are tools you can use to protect your assets at various points in your marriage as well as strategies during divorce.

Before getting married, more and more couples are finding that a prenuptial agreement is helpful to designate which assets will become marital property and which (if any) are to remain non-marital property. These assets may include an inheritance, a business, or other similar items.

If you wish to put something like this in place after marriage, you can do so with a postnuptial agreement. Our office can help with both – just give us a call!

During a divorce, however, your attorney may also be able to help you protect the assets you have worked so hard to build. Doing so is more challenging and there are no guarantees, but our legal team does everything possible to protect your rights and assets.

Marital and Non-Marital Property in Illinois

In some states, property is divided equally (community property); in Illinois, it is divided equitably. This means that it may not be divided 50/50, as other factors will be taken into account by the court.

These factors often include but are not limited to:

• The existence and details of a prenuptial or postnuptial agreement
• The length of the marriage
• Each spouse’s age, health, and station in life
• Whether a spouse is receiving alimony (spousal maintenance)
• Each spouse’s vocation, employment, and skills (earning ability)
• Each spouse’s debts and financial needs
• Each spouse’s contribution to or decrease in value of marital property during the marriage

In Illinois, marital property is property that either spouse gained during the marriage. However, it will also often include property that either spouse brought into the marriage and commingled (i.e., put into a joint account or joint ownership).

For example, if one spouse inherited money or property before or during the marriage and put that inheritance into a joint account, it would become marital property and would be divided equitably during a divorce.

However, if that same inheritance was not brought into joint ownership – or if it was decided in a prenuptial or postnuptial agreement that it would be considered as non-marital property, it would be protected from being divided in the divorce agreement.

The Importance of Estate Planning During Divorce

During a divorce, estate planning isn’t just important, but essential. Meeting with an estate planning attorney (just downstairs from our family law team’s offices) can help you in a lot of ways.

An experienced estate planning attorney can help you create a plan that resolves questions such as:

• As a single parent, who will take care of my children if I am hospitalized?
• If something were to happen to you, how would you keep your money, assets, home, and accounts out of probate (so your estate would pass to the people you choose, rather than get eaten up in probate costs and estate taxes)?
• How can you ensure that your children are well-taken care of throughout their childhood and get the inheritance you want them to have?
• Where do beneficiaries need to be updated?
• How can estate planning help you with tax planning? 

At Diamond Legal, our team is ready to help you answer these questions and more as we create a plan that fits your current situation and your future goals. To learn more, give us a call today!

DISCLAIMER: Any information contained herein is solely for informational purposes. While it is important that you educate yourself, nothing herein should be construed as legal advice or create an attorney-client relationship. For specific questions, we urge you to contact a local attorney for advice pertaining to your specific legal needs.