Making a plan in advance, ensuring your assets are directed according to your wishes after you pass away.
Believe it or not, estate planning is for everyone, it is not just the exercise of preparing a Will (a will plays a key part in the estate process). Our estates not only comprise of car, real estate, personal possessions, and bank accounts, it also life insurance, superannuation proceeds, businesses, family trusts, and any other legally owned assets.
In addition, estate planning also includes taking into consideration how you will be cared for (medically and financially) in the event you are unable to make these decisions in the future and an understanding of the tax consequences of how/whom assets are distributed.
Potential consequences of not having adequate estate planning in place:
- Death: Assets will be distributed in accordance with probate law in your State, depending on your personal circumstances at home, the distribution could leave your spouse only receiving a fraction (not enough to live on). If you have minors, the court will control their inheritance and if both parents pass (e.g. in an accident at the same time), the court will appoint a guardian for your children.
- Disablement: The court and NOT your family can control how your assets are used in order to care for you.
When taking your estate planning requirements into consideration, a few key documents you may need to include:
- Valid Last Will and Testament (keep up to date)
- Binding Death Nomination or Non-lapsing Death Benefit nomination for your superannuation and life insurance proceeds
- Nomination of a beneficiary for your life insurance proceeds outside of superannuation
- Appointing an Enduring Power of Attorney (POA) of Power of Guardianship – act in your place when you unable to or no longer able to with regards to your financial, medical and health care.
- Testamentary Trust (set up in the event of your death)
- Business Succession
Important things to note:
- Assets not covered by a Will (Property – Joint Tenant, Assets held by a company of Trust, Super/Life proceeds)
- Tax implications of the distribution of proceeds (dependant/non-dependant under tax law)
- Protection of at-risk beneficiaries (adult child going through a divorce, your minor children, someone who has a gambling or bad spending habits)
- Death Benefits Payment – Lump sum or Income stream?? (tax implications)
Having a good estate plan in place allows you to have control and ensures the future is financially secure for you and those close to you goes beyond planning in retirement.
“The right payment to the right person at the right time in the right way”
Speak to a professional or contact our office if you would like some assistance in mapping out the best possible estate planning objectives for you and your loved ones.