Estate Planning

The importance of estate planning cannot be overstated. Tying up your affairs gives you peace of mind and ensures that, if the worst happens, your assets pass according to your wishes. If you have children, an estate plan also ensures that the wealth you have accumulated is preserved for future generations of your family.

All too often, people put off considering these issues. However, no matter how simple you think your situation is, dying without an estate plan can cause considerable difficulties for the people you leave behind, and may see your property falling into the hands of the wrong people. Also, your estate may be more complicated and sizeable than you at first think – for example, if you have superannuation, insurance policies or trusts.

 

Crucial Considerations When Planning Your Estate

• Do you want to leave specific gifts (for example, jewellery)?
• Do you have children and/or grandchildren? If so, how will you preserve their inheritances?
• Do you want to ensure that someone doesn’t inherit from you?
• Do you have a mixed/blended family? If so, it is particularly important that you seek estate planning advice.
• How do you want your superannuation benefits to pass?
• Do you have insurance policies? If so, who will receive any benefits when you die?
• If you are involved in a business, who will take control?
• If you have a trust, who will take control of the trust?

Things You Need To Be Aware of with Your Will

• If you die without a valid Will, your estate passes in accordance with ‘intestacy’ – which does not reflect your wishes. If you have no surviving relatives, your entire estate will go to the government.
• Superannuation and insurance benefits pass in accordance with separate documents, and not in your Will.
• Certain people (for example, ex-spouses) can contest your estate and may succeed unless you have a strategy in place.
• If a beneficiary of yours divorces or is involved in bankruptcy proceedings, they may lose a significant chunk of their inheritance.
• Your business may fall into the wrong hands without appropriate succession planning.
• You can significantly minimise the tax that your beneficiaries will pay in the future in relation to their inheritance with appropriate estate planning.

Estate Discussion and Planning

You should discuss your particular circumstances with an estates lawyer, who can assist you in implementing an estate planning strategy. Ideally, you should execute the following documents:

• Will with, if appropriate, specifically drafted trusts;
• Enduring power of attorney (in case you lose capacity);
• Death benefit nominations in relation to superannuation and insurance;
• If you have a trust, deeds to pass control; and
• If you are involved in a business, an agreement with a ‘Buy/Sell’ mechanism.

Having a strategy in place will ensure that your estate is distributed in accordance with your wishes. It will also reduce stress and give security and certainty to the people you leave behind.

And don’t forget to consider your digital assets.  Not sure what these are?  Go here for more information.

By the Private Wealth team at Chamberlains Law Firm:

Vik Sundar
Practice Leader – Private Wealth
E: vik.sundar@chamberlains.com.au