The advantages of a properly drafted Will and Estate Plan
The average person’s assets are now more complex than in generations past. Most working people will have superannuation, often with a substantial life insurance component. Many people have interests in family trusts and companies.
Specialist legal advice is required to understand how these different types of assets will pass on your death.
Control who receives your assets: If you die without a Will, the law sets out who inherits your estate. This may not reflect your wishes. Having a valid Will is crucial in order to ensure your assets pass in accordance with your wishes. Particular care should be taken where there is a blended family, to ensure the needs of your current partner and the needs of any children from a previous relationship are fairly and properly balanced.
Provide tax advantages: Your Will can be drafted in a way that provides your beneficiaries with opportunities to receive and invest their inheritance in a tax effective manner.
Provide asset protection from third parties: Your Will can be drafted to help your beneficiaries to protect their inheritance from exposure to risk via their occupation, bankruptcy proceedings, and family law claims.
Protect the inheritance from the beneficiary’s own actions: If your beneficiary cannot be trusted to use their inheritance wisely, due to issues such as gambling or substance abuse, the Will can contain clauses that give control of the inheritance to another person who can manage the inheritance on behalf of the beneficiary.
Prevent challenges and disputes: Common challenges against Wills include:
- A claim by a family member for further provision from the estate; or
- An allegation that the will-maker did not properly understand their Will, or was pressured into signing their Will.
A properly drawn Will, along with other legal strategies, can reduce the risk of your Will being challenged.
Ensure all of your assets are planned for: Not all of your assets may be covered by your Will. In particular, your Will generally cannot gift jointly owned assets, assets held through superannuation or family trusts, life insurance, or assets owned by companies. Specialist legal advice should be obtained to gift or pass control of these assets after your death.
Other key points:
- Prepare your Will whilst you are still of sound mind and body. Leaving this until the last minute can result in a situation where you no longer have legal capacity to make or alter your Will, due to illness or infirmity.
- Review your Will regularly. In particular, entering a new relationship, the birth of children, separating from a partner, or a restructure of your assets should be triggers for thinking about whether your Will accurately reflects your current circumstances.
In the meantime, the following articles, written by members of our Wills and Estates team, may assist you in preparing your Will and estate planning.
- Are ‘Do it yourself’ Wills legal?
- Have you reached a point in your life where you have started to ask the question: ‘Do I Need a Will?’
- Protecting my assets after death
- Estate planning and family law: Protecting the inheritance from family law claims
How Sharrock Pitman Legal can assist you?
The information contained in this article is intended to be of a general nature only and should not be relied upon as legal advice. Any legal matters should be discussed specifically with one of our lawyers.
Liability limited by a scheme approved under Professional Standards Legislation.
Binay Prasad is a Senior Associate of Sharrock Pitman Legal and an Accredited Specialist in Wills and Estates law.
Binay has over 10 years of experience in the field of wills and estates and has a particular interest in complex estates involving business, family trusts, and SMSFs. Binay also has experience in family law, which complements his wills and estates practice. For further information, contact Binay on his direct line (03) 8561 3329.