You have two choices: decide to die without a will and hope for the best, or get yourself a will to set out what you would like to happen to your assets when you die or become unable to make these important decisions yourself.

You may need:

• An estate plan
• Will
• Testamentary trust
• General power of attorney (while you are capable)
• Enduring power of attorney (if you become incapacitated)
• Enduring powers of guardianship
• Legal and financial update on your circumstances
• Superannuation death nominations (or a BDBN)

An estate plan is the full plan, that includes many components
Your estate plan can include a will, trusts, and other legally-binding documents that direct events after you no longer can. This includes medical care, financial plans, and other elements of your life.

To write up an estate plan, you must be aged 18 or over and be considered mentally competent.

Binding death nominations for your superannuation override your will, as does a family trust, so you should make sure that these always match. A good estate plan reduces your tax obligations and smooths the way to a hassle-free death. (Family feuds are not uncommon.)

Your will
A will comes into effect when you die and explains how your assets are to be divvied up amongst your heirs. It also explains who is to care for your children if they are still young, trusts to be established, any charitable donations, and instructions for your funeral if you are so inclined.

A lawyer can be utilised to write up your will and make sure any other components match what’s detailed there, like in trusts and superannuation.

Keep your will valid at all times – relationships change, people die, and feuds develop across a lifetime, and the will you made at 40 won’t be the same will you would write at 60. Every year, review what’s written (you should have a copy) and check important things. Legal rights change with life changes, and it’s important you are aware of these changes, particularly with the death of a spouse, divorce, and children.

If your will is invalid or nonexistent, the state’s laws come into play. Read about dying intestate here. If you don’t have any living relatives, your money gets given to the government.

Testamentary trusts
These are set up to protect your assets, and there are many benefits – read about the benefits here and here. We explain testamentary trusts here.

The short version is that trusts are useful if:

• you have kids under 18 (or even under 21);
• your beneficiaries have diminished mental capacity;
• you don’t trust your beneficiaries;
• you don’t want your family assets split as part of a divorce; or
• you don’t want bankruptcy proceedings to interfere with your family assets.

You will need to appoint a trustee, who is a trusted person who follows the instructions in the trust deed. There is usually an expiry date set, for example when a child reaches the age of 18 or another life milestone (marriage, baby, qualifications).

Powers of attorney – the legal authority to act on your behalf
There are three types – a general, enduring, and medical power of attorney. The person you choose to give your powers of attorney to is beholden to take care of your affairs on your behalf. Each state has different rules, so check with your local government to see whether this includes financial powers or more.

As you age, consider setting up:

• an enduring power of guardianship, which means someone can choose where you live, what medical care you receive, and what lifestyle you have, if you cannot make these decisions for yourself.
• An anticipatory direction records your wishes for future medical care, if you can’t do it.
• An advance healthcare directive (living will) details how you want your body to be dealt with if you cannot make those decisions yourself.

Getting good advice can make all the difference.

Documents you will need in a safe place

• Birth certificate
• Marriage certificate/s
• Will
• Enduring power of attorney
• Insurance policies – home, contents, car, life, health
• Deeds for real estate
• Medicare details
• Concession cards
• Prepayments for anything including funeral arrangements

Call us today for a chat about your estate planning needs.