While going through a California divorce, you have many things to consider. One of them is something most people don’t think about, life insurance. Managing your life insurance can make things easier.
Review your life insurance policy
During your divorce, you may want to review your life insurance policy. You want to make sure you have the right amount of coverage depending on your prospective financial situation once the divorce is final. Take into account details like alimony and child support.
Update your beneficiaries
You will want to update your beneficiaries as soon as possible. Remove your spouse as a beneficiary to prevent potential issues in the future. This is especially important if your divorce is contentious. You can replace them with someone else in your family if you so choose. Your children should be listed whether they are minors or adults.
Consider the cash value route
Your life insurance policy might be capable of accumulating good amounts of cash value over time. When you make payments toward your premium, it can make your money grow even more as you earn significant interest. During or after your divorce, you can opt to take the cash value from your policy if you need it. If the policy is also in your spouse’s name, the cash value will be split after the divorce is final.
Protecting alimony and child support
If you’re the one who will receive alimony and child support after the divorce, you need to protect that money. Taking out a life insurance policy on your spouse post-divorce can help you to protect future alimony and child support payments. You can also pay the premiums yourself to cover these types of support.
Many people overlook life insurance during a divorce. Keeping your policy in mind can protect you.