Wills, Enduring Power of Attorneys and Estate Planning – What’s the big deal and why bother?

It is all too common especially in today’s busy world for people to put off estate planning.  Estate planning refers to tasks associated with setting up your assets and liabilities so that in the event of your death or incapacity the assets and liabilities are managed in accordance with your wishes, pass to the people you wish to benefit and ideally minimize expense and tax.   Wills and Enduring Powers of Attorney are essential components of estate planning.

It is a common perception that there is no need or point for estate planning if you have very simple assets such as only owing a house, car, superannuation and one or two savings accounts.  However, this perception is also usually based on incorrect assumptions such as:

  • that in the event that you become incapacitated your spouse will automatically be able to make personal and financial decisions for you;
  •  that if you pass away without a Will that your spouse will automatically be entitled to your entire estate; and
  • that superannuation entitlements will automatically pass to the person nominated as a beneficiary to the fund or will automatically pass to the estate.

 

Do you actually know what assets and liabilities would fall into your estate should you pass away?  Do you know who can control and benefit from your estate?  Proper estate planning gives the answer to these questions and can:

  • save you, your estate and your beneficiaries money and expense by allowing your affairs to be managed in the most efficient way and in a way most likely to reduce potential conflicts;
  • give certainty to you and your family as to how your affairs are to be managed in the event of your incapacity and death;
  • allow your assets to be used for people you wish to benefit in the event of your incapacity or death.

 

A properly drafted Will and Enduring Power of Attorney that have been prepared as part of a total estate planning exercise should provide for arrangements in the event that something happens to you, and if something happens to your immediate next of kin.  Just as most of us consider putting on a seatbelt when you travel in a car an essential safety step even though you don’t actually think you are going to be in a car accident, everyone should take the essential safety step of having a current accurate and well considered Will and EPOA.

To assist in developing an effective estate plan and an appropriate Will and Enduring Power of Attorney you should ideally obtain legal and accounting advice.  It will be necessary for you to provide information regarding the following:

Past

  • previous marital and/or de facto spouses;
  • any matrimonial or de facto property settlement you have had;

Present

  • your assets, income, life insurance, superannuation and liabilities;
  • informal loans you have made to any person or that are owed by you;
  • your immediate family;
  • specific gifts you might wish to leave in your Will;

Future

  • who you wish to be the executor of your Will;
  • specific wishes you might have about a funeral or cremation;
  • who you would like to receive the benefit of your estate, and who would be your second choice if the first choice does not survive you;
  • who you would like to make personal and/or financial decisions for you if you could not do so;
  • if you would like any particular people to be able to have the benefit of your funds and/or property if you were incapacitated;
  • who you would nominate to be a guardian of any children of yours who are under eighteen, and any wishes you might have regarding care or benefits for those children; and

Exclusions

  • any things that you definitely would not want an attorney to do with your money or property if you were incapacitated (such as sell your home if funds were needed for your care);
  • if there is any person that you definitely would not want to have benefit from your estate

 

If you would like assistance regarding Wills, EPOAS or estate planning or you have further questions then please contact our Alicia Schubert on 3711 2709 or send us an email.