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Updating Beneficiaries After a Divorce


While we all hope that our marriages will last forever, the reality is that they do not. Close to half of all marriages will end in divorce. Divorces encompass many elements, some which you may not even think about until it is too late.

While topics such as child custody and property division are handled during the divorce, what about your retirement plans, such as your 401(k) or IRA? Who will receive the proceeds from your life insurance if your ex-spouse is still listed as the beneficiary?

These are important questions because each state is different. Plus, you probably do not want to leave potentially hundreds of thousands of dollars to someone you divorced decades ago, especially if you went through a bitter divorce.

Read on to learn more about the laws surrounding plan beneficiaries after a Florida divorce and what steps you need to take to ensure everything is in order.

What the Law Says

Fortunately, state law does protect you to some degree if you fail to update your beneficiary designations following a divorce. Under Florida Statutes Section 732.703, if a person was to provide payment or transfer of an asset to their former spouse upon their death, that designation will be declared void. Once the marriage is officially dissolved, the ex-spouse no longer has a claim to the following policies:

  • Employee benefit plans
  • Life insurance policies and qualified annuities, whether or not they are part of an employee benefit plan
  • Individual retirement accounts
  • Payable-on-death accounts

What This Means

Even though your ex-spouse would not receive any payment of benefits in the event of your death, you still need to review all your accounts and make appropriate changes. For example, do you have contingent beneficiaries? If your former spouse will not receive your benefits, then who will?

This means that after a divorce, you should determine all policies you have in place and make appropriate changes. You may want to add adult children, siblings or other family members to your policies instead. If there are no beneficiaries named besides your ex-spouse, then the funds will go through your estate upon death. This means that your life insurance policy or IRA may be used for estate taxes instead of going to an heir.

But what if you what your ex-spouse to remain the beneficiary? What if you have young children and are required by the court to maintain life insurance for child custody or alimony purposes? This is a common situation. To make sure your ex-spouse does not get voided from your policy, inform the life insurance company that you need to reaffirm your former husband or wife as beneficiary. You will likely need to complete and submit a form.

Seek Help for Your Divorce

Divorces can be complex and emotional. Many parties are more concerned about property division and child custody, and often overlook beneficiary updates, However, these are important in the event of your death.

If you are deciding to end your marriage, the Dade City divorce attorneys at Madonna Law Group can make sure that all aspects of your divorce are handled. Contact our office today to get started. Call (800) 557-0411.

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