Creating a will and estate planning is a good opportunity to take stock of your life and decide what and who is important to you. This can be an arduous, emotional task as it requires deep thought as you progress through life’s stages, such as marriage, children, becoming a grandparent, and finally getting your affairs in order.
There are numerous decisions that should be considered when creating a will and estate planning but here are some of the more important ones:
1. Do I need to use a solicitor?
In today’s highly litigious society, one incorrect word in a will can create uncertainty. A solicitor can ensure that the wording is correct, there are no loopholes, and that the chance of your will being challenged in court or create a family riff will be minimised. A solicitor can also ensure that your will is adaptable so that when your life circumstances change, for instance marriage, children, business interests, etc, it won’t be needlessly expensive or complicated to adjust the will.
2. Get legal advice for complex situations
It is especially important to use a solicitor if your will is complex, maybe you intend to exclude someone who would normally have a right to a share in your estate, perhaps you have a child with special needs or complex business interest, etc. A self-written will may encourage an otherwise reluctant person into thinking about making a claim against your estate.
3. Ensure that your will is signed and witnessed correctly
There are very specific actions that need to be undertaken to ensure that a will is valid. Procedures such as who can and cannot be a witness, how they have to witness, where they have to sign are important to the validity of the will. Also, the role of beneficiaries, trustees, executors, and other such normally mundane considerations, all of a sudden can become the determining factor in whether a will is successfully challenged or not in court.
4. Choosing a guardian for your children
It is one thing to leave possessions and assets to your children, but which guardian do you leave your children to if you unfortunately passed away while they are still minors? This is an opportune time to see if you have people in your life that have similar lifestyles and beliefs, that your children already have a bond with, and ideally do not require a significant move to another state or country. Don’t forget to talk to anyone you might have in mind so that they can be aware of your intentions and prepare themselves to say yes if the unfortunate time ever comes.
5. Be specific in your will and estate planning and include your wishes in regards to sentimental possessions
Items that don’t have any significant monetary value, such as heirlooms, sentimental items, and cherished possessions should not be overlooked. A favourite watch, jewellery, decades-old trinkets, family photos, and other such items generally cause the most disputed aspects of a will as people fight for a keepsake of their departed loved ones. To overcome this, itemise each sentimental possession in your will and your wishes as to who will receive it.
6. Determine who you want to be the executor of your estate
If there is one person you can rely on who is able and happy, to execute the wishes of your estate, then this is fortunate. However, it is not uncommon to have multiple people as executors, and you can arrange it so that they either manage different aspects of the estate or every decision must be made jointly. However, if there is no one you feel confident to nominate, or it will cause family friction, then consider appointing a third party as executor, such as a solicitor, or a private trustee. There will be costs involved going down the third party route but it will at least avoid any future conflict.
7. Consider setting up a Trust so that your assets are easily distributed to your beneficiaries
It is a lot simpler and more cost effective if all your assets are owned by the one entity than searching and winding up different entities after you’re gone. The more work that your executor has to do, the more cost involved and the longer the delay with your assets actually reaching your beneficiaries. However, ensure that whoever you appoint as trustee is competent, able, and honest to manage the investments.
8. How to handle joint assets
Consider whether any assets that you own with other people are something that you want your beneficiaries to deal with or if you prefer it to be disposed of. Maybe you have a good relationship with your business partner, but your children would rather have nothing to do with them.
9. Talk to your accountant to manage your tax obligations
There are taxation issues, superannuation issues, potential capital gains tax, etc, that you need to discuss to ensure that your beneficiaries benefit from your estate, and are not penalised.
10. Don’t forget to account for your digital assets
Many possessions are now kept in digital form, such as your financial portfolios, music and photo libraries, private emails, and social media accounts, and it is uncertain who has access to these digital assets if no provision was made for them. Also, if no one has the username or password, then consider them practically lost in many circumstances as cloud-based service providers do not generally provide login information to a third party.
As you can see, it is no easy task to create a will and plan your estate. There are many considerations that need to be decided upon, people to talk to, and professionals to consults to ensure that your estate is an easy and hassle-free affair after you have passed on. Having an up to date will, which is clear and organised, can mitigate some of the pain that your loved ones will be feeling during the weeks and months after your passing.
We’re here to help simplify the process of creating a will and estate planning. We offer the convenience of coming to your home, office, hospital or other suitable location to assist you in making your will. We also have an online Wills & Estate Planning Tool that allows you to create or update your will with ease.
If you would like to discuss your personal situation and obtain advice with your will and estate planning, please contact us on (02) 9913 3377.