No one likes to think about death. We often avoid this topic because it’s either too confronting to think about, or we just don’t expect it to happen to us ‘just yet’. So we end up putting off any form of estate planning for a rainy day which doesn’t seem to come along.
The reality is however, that we don’t know what the future holds. We’ve seen that clearly with the outbreak of COVID-19 and for many this has made them think more about the uncertainty of life. Online providers started experiencing an increase over 250% in downloadable Will kits since March 2020 as people are increasingly concerned about possibly dying.
We don’t know when we will breathe our last and that is why it is so important to plan ahead and ensure that we have made the right provisions for when that day comes.
When someone passes away without a valid will, it is said that they have died intestate. Each state has their own process of working out how to distribute the individual’s assets to their next of kin. This is almost always passed on to their spouse and/or children.
Specifically for customers looking for Estate Planning in North Brisbane, under the Queensland Succession Act 1981, intestacy rules will apply without regard to the requirements of the family.
A basic overview of the rules are as follows:
- If you have a spouse and no children, your whole estate is given to your spouse
- If you have a spouse and children,
- and your estate is worth less than $150,000, then it is given to your spouse.
- And your estate is worth more than $150,000 then $150,000 is given to your spouse and
- If 1 child, they get ½ of the balance of the estate
- If two or more children, they get 1/3 of the balance of the estate
- If you have no spouse and surviving children then it will be given in equal shares
- If you are survived by your parents and no spouse/children, then they will receive the whole estate
There are then further laws and rules depending on the surviving relatives. Now although this may seem ‘fair enough’, we know that relationships can be much more complex than this and intestacy rules are inflexible. For instance, what if you have estranged children that you have not seen or spoken to for many years? Or have you recently become divorced or married? Without a valid Will, your assets might be distributed against your wishes and will follow these rules regardless of how recently you were in contact or the depth of relationship.
By establishing a valid Will, you will be able to determine how your assets should be shared and provide for those whom you decide. This will also avoid potential conflict and delay as your wishes have been clearly set out and can’t be disputed. Furthermore, you will also be able to choose an executor for your will, make donations to charities, look at tax efficiency or gift specific items to your chosen beneficiaries before dealing with the balance of the estate.
Estate planning however also involves much more than just a valid Will. Have you thought about who would look after your children if you passed away? Who do you give permission to act on your behalf? And who should make decisions for your if you are no longer capable of making them? These are all important questions to consider.
That is why the advisers at Lifelong Wealth discuss estate planning during your appointment as it forms an important part of the overall wealth management planning process. We can also discuss your superannuation beneficiaries and ensure these are up to date in the case of your death.
Although we can’t help you with writing a Will, we can point you to the right people to assist you with this, specifically as we are located in the Lawnton/Stratphine area.
So here are some frequently asked questions relating to estate planning:
- I have picked up a Will kit a while back and completed this. Is this sufficient?
Although Will kits can be less expensive and convenient, we do not think that these are sufficient. A Will kit does not always cover everything that a solicitor might do, and if they are not done properly, your Will could be deemed invalid. Will kits also lack the ability to deal with complex issues such as taxation, blended families and superannuation, and if you are not clear about assets only you hold, you risk dying intestate.
- How often should I update my Will?
This needs to be an ongoing discussion with your solicitor however it is a good idea to think about updating your will with every new life event or major change of circumstance such as marriage/divorce, a new child, buying or selling property, or the death of your executor/beneficiaries.
- Do I have to have updated estate planning before I see a financial adviser?
The short answer is no. Although you can still see us and discuss your financial circumstances, we would highly recommend you get in touch with a solicitor to discuss your estate planning. We take a holistic approach to your financial situation, and this forms an integral part to your overall plan.
- If I change my beneficiaries, do I need to let my financial adviser know?
Yes. When you make changes to your beneficiaries, it is important to discuss the change with us so that we can see if it affects your superannuation and other areas that you might not have thought of. You might also be required to sign new documents regarding this. We recommend for you to come and talk with us about these changes so nothing is missed.
- What will happen in the event of my death in regards to my financial advice?
Advice fees will cease on the death of a client. For a lot of our clients’ families, it may be the first time they have had to deal with something like this. If they see a financial planner at Lifelong Wealth (located north Brisbane), they can expect us to help them through the process and answer any questions they may have. All our planners have over 12 years’ experience and have been through this process a number of times so have the expertise to help them.
Book an appointment with us today, or give us a call if you wanted to discuss these services further.