Estate Planning – Wealth Succession and Protecting Your Assets
You spend a large part of your life working to live the life you aspire to, providing for your family and saving for the future. Given the focus that is placed on creating wealth while you’re alive, it seems logical to want some control over what happens to these assets once you are gone.
What’s involved in estate planning?
There are four main tools that can help you with your succession planning:
When should you update your Will?
Your Will should be reviewed and updated whenever there are major changes in your life, such as marriage, separation or divorce, the birth of children, significant changes to your assets, significant changes to the way you own assets such as a self-managed superannuation fund, entering a new business or a change to existing business structures or retirement.
What should you consider when thinking about a Will?
When planning for your Estate, there are a few questions that you should ask:
Who do you want to be your beneficiaries?
Who will you choose as the executor of your Will?
Do you have any special instructions outside of the standard bequests?
What assets would to be included?
Are there any tax implications?
What would happen if you didn’t have a Will?
Passing away without a Will is called “dying intestate”. When this happens, your assets will be distributed according to a strict formula set out in legislation. This formula may not be in line with your wishes and the outcome may not be in the best interests of your family and loved ones.
What is not distributed through your Will?
“Putting in place a good estate plan can be one of the most valuable gifts we can leave to those closest to us, regardless of the quantum of our assets.”
What is a Power of Attorney?
A Power of Attorney is a legal document allowing you to appoint someone to act on your behalf on your legal financial and property matters. When enacted, the signature of the attorney you appoint has the same legal force as your own.
What is an Appointment of Enduring Guardian?
An Enduring Guardian is able to make decisions about your personal wellbeing (where you live, the healthcare you receive, consenting to medical treatment) if you ever lose the capacity to make these decisions for yourself.
What are the Benefits of a Testamentary Trust?
A Testamentary Trust is a trust created in your Wills which can provide you and your beneficiaries with significant benefits. Some of the main benefits are income tax savings for beneficiaries, special tax concessions for beneficiaries under 18, capital gains tax savings for beneficiaries, protection of beneficiary’s inheritance from bankruptcy and family law claims
and preservation of your assets in the family, rather than them passing on to non-family members.
Estate Planning and Property
One of the trickiest parts of an Estate Plan can be around property assets due to the usual attached debt, illiquidity of the asset, ownership and splitting up the asset between beneficiaries. It is extremely important when entering into the property market that your Estate Plan is up to date.
A word from the Expert:
Our Announcer Estate Planning expert, Anthony Fondacaro of Legacy Wills & Estates, has this to say about Estate Planning, particularly in regards to property:
“Good Estate Planning must include a thorough review of a person’s assets, relationships and intentions. The most important question when it comes to property, is “how assets are held – solely, as joint tenants or as tenants in common”. The answer to this question will determine how to administer each asset, including whether a Grant of Probate (Will) or Letters of Administration (no Will) is required”.