February 2021 Issue: Advising your Clients Throughout a Divorce-Advising your Clients Throughout a Divorce by Brian Thompson

Advising your Clients Throughout a Divorce by Brian Thompson

Pdf Summary

The Covid-19 pandemic has had a significant impact on people's lives, leading to job loss, homelessness, and relationship strain. Divorce rates have risen by 34% compared to the previous year. As a financial advisor, it is important to provide support and guidance to clients going through the divorce process. Starting with empathy and compassionate communication is essential before delving into the technical aspects.<br /><br />Before the divorce process, clients should get organized by updating their estate planning documents. This includes creating or modifying a will to distribute assets and appoint guardians for their children. A trust can also be established to hold property for the benefit of a third party. Clients should also update their durable powers of attorney to ensure their chosen individuals can make decisions on their behalf.<br /><br />After the divorce is finalized, it is crucial to review and change beneficiary designations on retirement accounts and nonprobate transfers. It is important to consult with an estate planning attorney to navigate any changes and revocation terms. Clients should also be aware of actions to avoid, such as hiding assets, funding new trusts, or cashing out insurance policies, as these may have legal consequences.<br /><br />Ultimately, as a financial advisor, you can provide invaluable support to clients as they navigate the emotional and practical aspects of divorce. By providing guidance, updating estate planning documents, and helping them realign their financial goals, you can assist them in moving forward and starting fresh.

Keywords

Covid-19 pandemic

job loss

relationship strain

divorce rates

financial advisor

estate planning documents

trust

durable powers of attorney

beneficiary designations

legal consequences