Update your will

It’s not a pleasant topic to think about, but it’s essential to have plans in place to ease the burden on your family in the event of your death, particularly if you are the sole or main breadwinner in the family.

Estate planning is essentially directing what happens to your assets when you die, usually through an up-to-date Will.

Family members dealing with grief and shock following the death of a loved one are rarely able to cope effectively with intrusive but necessary decisions such as managing financial affairs and the prospect of life without an income earner.

The grieving process is made a lot easier if an up-to-date Will with carefully planned testamentary trust arrangements is in place with current records of all the assets and liabilities readily available, and adequate insurance policies taken out. Our solicitor Patrick Donovan can assist you in this process.

Everyone over the age of 18 should have a Will, regardless of whether they are single, married or in a de facto relationship, but particularly if they have children. Now that most workers have accumulated savings in a superannuation fund that also provides life insurance cover it is especially important.

A Will can:

? appoint an executor

? nominate a guardian for any young children

? direct who is to receive assets and on what terms.

In other words a Will lays out your wishes. However, while it governs all the assets in your estate, including those owned directly, shares in property owned as a tenant-in-common, life insurance proceeds, and any superannuation death benefits paid to the estate, a Will may not cover every asset a person has an interest in.

Wills do not cover assets owned as a joint tenant (these pass automatically to the other joint tenant, usually your spouse); assets held in trust (the trust deed governs what happens to these assets); assets owned by a company (only a company can deal with its assets); superannuation death benefits or life insurance policy proceeds paid directly to a beneficiary.

For those without a Will, or with an invalid Will, the law will dictate who receives assets and when. In other words, someone else is making decisions for you, so unless you want that to happen it’s important to have a Will and to keep it up-to-date.

For instance, a Will may be rendered invalid by a marriage that isn’t specifically mentioned in it. In most Australian jurisdictions, divorce can either invalidate an entire Will or those clauses that refer to a former spouse. Separation, however, does not usually affect the validity of a Will, so an estranged spouse may still receive assets.

A common approach for couples is the ‘I love you’ Will, where they leave everything to each other and then to any children should they both die. However these Wills are not always an effective way to distribute the estate to beneficiaries, as they don’t minimise tax or protect their bequeathed assets.

Contact Wrights Legal for further assistance and advice