Spouses who are approaching divorce often cannot wait to remove their exes as beneficiaries from their wills, trusts, and life insurance policies. And this logic makes sense. After all, who in their right mind would want to leave their fortune to someone who is no longer part of their lives? A spouse may feel even more strongly about this if their ex committed marital misconduct of some kind. Perhaps they were unfaithful. Maybe they engaged in heavy substance abuse, or uncontrolled gambling. Whatever the case may be, most spouses would not want these individuals inheriting a single dime. In fact, the very thought of this happening might make their stomach turn. 

Is removing a spouse as a beneficiary always the best move? Maybe not. Of course, each situation is slightly different, and it always makes sense for divorcing spouses to receive personalized advice specific to their circumstances. As a general rule, however, removing a spouse as a beneficiary might not always be as “obvious” a choice as you might think. Why is that?

It Could be Illegal

Perhaps the most notable reason spouses should wait before removing beneficiaries is the fact that this could be illegal. Each state has their own unique way of handling this situation, and some states automatically prohibit spouses from switching beneficiaries as soon as the divorce papers are filed. Spouses should always check their local laws and regulations before making any hasty moves – and the best way to do this is to book a consultation with a qualified attorney. 

For example, Massachusetts and Tennessee have laws that prohibit spouses from removing or altering beneficiaries before the divorce is finalized. These laws specifically pertain to life insurance policies. Acting too quickly could not only result in legal consequences, but it could also result in higher fees. This is because spouses need to go back and fix mistakes, and this can be time-consuming and costly. 

It Could Affect Your Children

Spouses often assume that by removing their exes as beneficiaries, they prevent them from receiving any money after their passing. But these actions can also affect children. This is especially true if a spouse receives primary or sole custody after a divorce, as these funds may never find their way into the hands of the children if their ex is not a beneficiary. The judge may see this, and it could negatively impact the custody outcome. 

After the Divorce is Final

After the divorce is finalized, spouses can change beneficiaries without worrying about any unforeseen consequences. But while everything is still hanging in the balance and the details are being hashed out, it might be best to wait. Of course, there is always the risk that a spouse might pass away during the divorce. Although this situation is rare, it is not unheard of – and it can lead to many other issues aside from inheritance. There have even been situations in which beneficiaries have been forced to hand over money to a spouse’s ex because the laws were not properly followed.