Estate Planning and Wills
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The foundation of an Estate Plan is your last Will and Testament
Estate planning is the way that you anticipate and arrange for your estate to be passed onto your beneficiaries in the most financially efficient and tax effective.
A staggering 50% of Australians die without an Estate Plan in place!
Estate planning can be combined with savings, investment, retirement, and long-term care planning, as well as trusts, to form an all-inclusive tax-saving financial plan for the preservation of your assets; the protection and continued operation of your business; the support and care of your minor children upon you and your spouse’s death; and much more.
This area of law is a specialised area, within the field of Wills and Estates and whilst many lawyers include this field within their practice, Estate Planning it is very much a case of buyer beware! If you have your estate structured by a lawyer who specialises in this field, it could prevent heartache later down the track, with Will disputes and the tax complications.
For the past 20 years, Heckenberg Lawyers has been acting for clients wanting to establish an Estate Plan and they specialise in this area of practice.
If someone receives a Life Estate under a Will it means that they have the right to possession and enjoyment of property, including income from property, for the duration of their life. A Life Estate is usually created to allow a person to live in a property until their death at which time the property will vest in a person or class of persons named in the Will (called the “remainderman”).
There are many positives to the creation of a Life Estate under a Will. In a time of complex family arrangements a life estate can be used to ensure that the property of the deceased goes to children from a previous marriage whilst also allowing their current spouse the benefit of the property and income derived from the property. For example Ted had three children from his first marriage. When he and Mary got married they decided to sell Mary’s house and live in Ted’s house. Mary kept the proceeds of the sale from her house and made several gifts to family and friends. Ted and Mary agreed that if Ted died first Mary would have the right to reside in the house until her death and after her death the proceeds of sale of the house would be divided equally between Ted’s three children.
There are also negatives involved in the creation of a Life Estate. Going back to Ted and Mary above difficulties may arise if the relationship between Mary and Ted’s children is not amicable. In effect, Ted’s children will have no ability to deal with the property until Mary’s death unless an agreement is reached between themselves to sell the property to a third party.
Of more importance is that the creation of a Life Estate for a spouse may give rise to an application by the spouse for a family provision order on the basis that the Life Estate is an inadequate provision for their proper maintenance and support.
If you are interested in the creation of a Life Estate it is important that you talk to a legal specialist in Wills and Estates about the positives and the negatives of Life Estates. Our expert Wills and Estate Lawyers have advised numerous clients on the advantages and disadvantages of Life Estates including an honest appraisal of whether a Life Estate was appropriate in the client’s circumstances.
You work hard to build up and maintain your assets. It makes sense to take the same sort of care in making sure that your loved ones get the benefit of them when you are gone. But if you don’t have a will, your property will be divided up according to a set formula, whether you like it or not. And if you don’t have any next of kin when you die, your property will go to the State.
A Power of Attorney, is similar to that of a Will. It is a legal document whereby someone is appointed and has the authority to act on your behalf for property matters and financial agreements. The person you appoint as your Power of Attorney, cannot make decisions on your health or wellbeing, these are covered by a separate document, and the person appointed is known as Enduring Guardian.
The main benefits of Testamentary Trusts are their ability to protect assets and to reduce tax paid by beneficiaries from income earned from the inheritance and created by a Will. It helps provide a greater level of control over the assets of the Will.
Specialist Wills for Succession Planning? Do you need one? If you are in the process of having your Will drafted you might be wondering if there are Specialist types of Wills that would suit your circumstances and meet your needs by ensuring that your assets are passed on to your beneficiaries in way you desire.