Under Utah law a benefit granted to a person’s spouse in their Will or Trust automatically becomes null and void upon divorce. Oftentimes that leaves a “hole” in the estate plan, and unintended consequences may result if either spouse subsequently dies before the estate plan is updatef. Accordingly, it is imperative that following a divorce a person promptly update his/her estate plan.
Most importantly, there is a HUGE trap for the unwary associated with divorce. Beneficiary designations on retirement plan accounts typically list the spouse as the beneficiary of the account in the event the owner dies. Retirement accounts are governed by federal law, which takes supremacy over state divorce law. Therefore, if a person divorces and neglects to change his/her beneficiary designation on a pension plan, a 401(k), or an IRA, those benefits will be paid to the ex-spouse!!! That result is almost always contrary to the account owner’s intent. Accordingly, we strongly recommend that divorcing persons consult us to determine how beneficiary designations on retirement accounts should be changed.