Wills aren’t just for the sick or wealthy, if you’ve got a family, a home or investments you definitely should have one – especially if the asset is only owned by you. Your will is your voice after you die and can be drawn up to provide guidance around who gets what and the person in charge of the distribution process.
Dying without a will (intestate) leaves the decision to a judge. Your assets will be distributed by the law of the state where your property is located, regardless of what your wishes were. It could mean that your minor children could be awarded to someone not of your choosing.
If you have minor children, your will should name a guardian for them. If your children are a little older and perhaps living with partners but not married; the court may deem their relationship to be “de facto” and their partner would have claim to your estate, even if they separate. Testamentary trusts can assist with greater levels of protection for de facto and other relationships.
If you have a more complicated estate, you may want to consider a trust which can provide much greater levels of protection, control and tax effectiveness. You should provide your lawyer with clear instructions on how to change the ownerships on your accounts or changing the deed of your assets to reflect your newly created trust. For example, with a testamentary trust you could give your spouse the annual income from an investment property you owned but at the same time ensure the asset ownership passes to your children.
Trusts can also be useful to stagger an individual’s inheritance over time. We all know of or have kids who are not the most responsible when it comes to having large amounts of money in their possession. You could setup your trust to pay various amounts of the inheritance at ages 21, 25 and then 30, or you can tie the release of your assets to particular events, such as marriage, purchasing a house, education or overseas travel.
Having a lawyer draw up a will should generally cost about $500 to $1000. Your “will” should clearly state who gets what’s left to your estate. Accounts with beneficiary designations (Property, Superannuation, Insurance and Investments) are typically distributed (or assigned) prior to “the reading of the will” – so it’s possible that very little could be left to your estate. Nevertheless, dying with a will insures that any leftover assets will be awarded to the person or entity of your choice.
JBS can refer you to an appropriate solicitor who specialises in estate planning matters.