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Estate planning – Where there’s a will, the way might not be that obvious

Estate planning involves so much more than having a will. In this, the first in a series of articles on estate planning, we look at an overview of some of the important considerations.

Some good reasons for planning

Estate planning requires considering how your assets will be distributed upon the death of you or your partner. If you die without a valid will (also know as “dying intestate”), your assets will be distributed according to the laws of the state or territory in which you were living. The formulas used may not take into account what your wishes may have been and the whole process can be very time consuming and costly for your loved ones to sort out. Similarly, children under the age of 18 who are left without a parent may have a guardian appointed by the State and, once again, this may not be the outcome you had intended. These are good reasons to have a will and to make sure it is kept up to date.

It might not be included

The majority of your assets are covered by your will. This includes: possessions, property, money in bank accounts, shares and managed funds solely held in your name. However, there are some things that you might falsely assume get automatically looked after by your will. Some of these can constitute very significant family assets. We will consider superannuation, life insurance, assets held in a trust or company and jointly held assets in another article but these assets often fall outside of your estate.

Tax effective estate planning

Be aware that there may be taxation implications, for example Capital Gains Tax, when disposing of assets in accordance with your will. There are a few strategies that can be considered so your estate plan is as tax-effective as possible for your beneficiaries. We would be happy to look at your situation to determine what would be most effective.

Powers of Attorney

If you are concerned that you might not be able to manage your own affairs at some point due to physical or mental impairment, you should consider appointing a Power of Attorney. The rules vary from state to state so ensure you get advice on what types of Powers of Attorney are suitable in your circumstances e.g. financial, medical or guardianship.

Overall estate planning

Your estate planning should ensure a smooth transition of your assets and business interests in the event of your death. It is important to consider other documents such as buy-sell agreements if you are in business with someone else, business succession plans and broader family wealth management strategies. All of these things will be impacted by your death and it is important that these issues are carefully considered. For example, if you control a family trust you should ensure the deed allows for appropriate succession upon the death of the Trustee or Appointor.

Ongoing reviews

Once you have taken care of your initial estate planning needs, ensure that your documentation, including your will, Powers of Attorney and any binding declarations, are kept in a safe place and that your executor knows their location.

It is also very important to review your plan on a regular basis and certainly when major milestones and events occur in your life.

Help is at hand

All of our business advisory, tax and financial team are able to help you through the estate planning process. Having skilled professionals guide you through this process will mean that you can ensure that all relevant issues have been covered.

So speak to one of our team; they will be pleased to work alongside you and guide you through this important process.

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