Don’t be like Prince – Make sure your loved ones inherit according to your wishes

Why a Will is Important

Why leave the distribution of your assets to some third party? Wouldn’t you rather make sure that your loved ones receive the assets and items you wanted them to cherish once you are gone. Only a valid and current will can achieve this.

Making and maintaining a current Will is a critical aspect of any estate plan. A Will allows a person to direct how their assets are to be dealt with after their death. Everyone, even with modest assets, should have a current, valid Will.

We often find that the initial enthusiasm to talk about setting up a will fades after the event that triggered the idea that a will is needed. But since most folk have no idea when they might pass away, we still find an extraordinary amount of people die intestate, that is, with no will in place.

It is important to ensure that your Will;

  • Nominates executors (and successor executors) for your estate who are likely to survive you and who clearly understand your wishes.
  • Nominates beneficiaries in relation to the whole or part of your estate and nominate second choice beneficiaries should the first choice predecease you.
  • Designates whether it will bequeath monetary values, a percentage of your estate or specific assets to beneficiaries.
  • Considers the need for certain assets to be held in Trust for beneficiaries under 18 years of age (such as funds for your children or grandchildren’s education).
  • Takes into account any specific needs of beneficiaries (including social security).

Without a Will, you cannot control how your assets are distributed upon death. If you die without a Will, or your Will is incomplete, you are said to have died “intestate”. As a result your estate will be distributed strictly in accordance with the relevant state laws governing the distribution of estate assets according to where you live or where those assets are held (which may not be in accordance with your wishes).

 

Estate Assets can Include Estate Assets Do not Include
Shares (public & private) Jointly held assets
Assets that are held as tenants in common Superannuation benefits (paid directly to your dependants)
Cash investments and debts in your personal name Life insurance proceeds with beneficiary named in policy
Superannuation benefits paid to your estate Superannuation Income streams (if your dependants are the beneficiaries).
Life insurance proceeds if you are the policy owner and life insured  

 

Once you have a valid Will in place, it should be reviewed at least every 3 years and/or whenever your circumstances change. This should also be done in consultation with your solicitor.

 

Executors

Appointing the right executor is an important decision. The executor is responsible for carrying out your wishes as expressed in your Will and has fundamental control of the process. The person or persons you select must be capable of both performing the role and be capable of working with competent advisers. The administration of an estate can be time consuming and is likely to need investing, taxation, accounting and legal input.

 

Guardians

A guardian is a person legally appointed to care for another person. Guardians are usually appointed for children under 18 whose parents are unable to care for them (or who have no parents) or adults who are unable to care for themselves due to age, injury or illness. It is prudent to appoint a guardian in a Will in order to ensure that any dependants are cared for in the event of your death. The appointment of a guardian in a Will is only a declaration of intention. Ultimately the Family Law Courts have the power to appoint an alternative guardian if they deem it to be in the best interest of the vulnerable party.

 

Signing Your Will And Ensuring it is Valid

Here is the process to ensure that you finish up with what you wanted, namely a valid Will.

Step ONE

Find 2 people that are:

  • over 18 years of age
  • of sound mind; and
  • have an address in Australia.

The witnesses can’t be related to you or have any chance of being related to you (eg it can’t be your son’s girlfriend because your son could marry that person and then you would be related to the witness). The witness can’t be a person that is likely to get anything under the Will. The best witnesses are “strangers” who would be unlikely to inherit from you.

 

Step TWO

Get your 2 witnesses and yourselves in a room with the same identical BLUE pen that you will all use to sign the will. Lock all the doors so that none of you leave the room. If either of you or either of your witnesses leave the room during the signing process then tear up the Will.

 

Step THREE

You sign the Will on each and every page where marked. Then both witnesses (WITH THE SAME BLUE PEN) sign each page of the Will. If you signed with different coloured pens (eg a dark blue and a light blue) then tear up the Will and start again.

 

Step FOUR

Date the Will with the date at which the Will is signed and witnessed.

 

Step FIVE

Where should the original signed Will be stored?

You can leave your Will with your Executor, family friend or bank vault. Make sure that your Executors know where it is kept.

 

I would suggest that your executor holds the original Signed Will. Make two copies of the original Signed Will but make no further marks on the will as you do not want the photocopy to necessarily become YOUR will (unless the original is lost). Keep one of the copies for your records and send me the second copy which I will keep safe in your Client File so in the unlikely event that both your executor and your copy go missing, I will still hold a copy for you.

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