How do you ensure your will is set up properly?

Most people acknowledge that a will is an important document to create, but we all hope there’s no urgency to prepare it. As such, many people rarely ‘get around’ to it. One of the reasons for this is they don’t know enough about it and how to get started. This blog answers commonly asked questions and matters that should be considered when drafting estate planning documents. Rules are State based The laws that govern the administration of wills and intestacy (if you die without a will) is the State’s jurisdiction. This means rules may vary from state to state. Generally, if you die without a will, it is referred to as dying intestate. There are many adverse consequences of this including your assets being distributed in a way that you would not otherwise agree with. In addition, it creates unnecessary work and complexity for surviving family members to arrange probate. Simple circumstances requires a simple will If your situation is simple, you only need a simple will. Simple means that you do not have significant assets, you do not have any specific beneficiaries or financial dependents. In this situation, typically, a template will should be satisfactory. You can purchase these online for approximately $200. Make sure your will is witnessed correctly. However, the more assets you have (in terms of value), the greater the need for personalised legal advice. Like in many situations, often it’s what you don’t know that could cause problems. Kids complicate matters If you have children (or are contemplating having children), you should engage a lawyer to draft your will. Not only do you need to ensure that all financial dependents will be looked after, but you must address guardianship of your children. In the event that you and your spouse1 pass away, who will be the legal guardian of your children? This is an important decision which must be included in your will. I would typically advise people with children to insert a testamentary trust into their will. A testamentary trust is a special discretionary trust that is created upon death. The will maker can permit the executor to transfer the estate assets into the testamentary trust. Testamentary trust’s provide serval advantages including taxation savings (discussed below) and asset protection benefits. Blended families complicate matters further A blended family includes situations such as: both spouses have children from a previous relationship; and/or one spouse has children from a previous relationship as well as children with their current spouse. Blended family arrangements can create a myriad of potential risks that must be considered and addressed when drafting estate planning documents. Anyone in this situation must seek personalised legal advice from an experienced estate planning lawyer. Beneficiaries with special needs If you have beneficiaries or financial dependants with special needs such as a child with a disability, battling addiction, mental health or similar issues, it is very important that you receive personalised legal advice. Ways to minimise the likelihood of family conflict Money and grief do not mix well. Otherwise healthy family relationships can turn sour when money is involved. But there are some steps you can take to minimise the chance of your family members fighting over your estate. Have difficult conversations You invite Read Stuart's latest book? He's only got 19 reviews on Amazon so far, if Wealth by Design helped you, leaving one would mean a lot: https://www.amazon.com.au/review/create-review?asin=192318654X Run your own business? Check out Business by Design, Stuart and Mena's show on starting, growing and exiting a business, at https://www.businessbydesignpodcast.com/ Our most popular free guides: Over the years we've written hundreds of articles. These three bring our best thinking together on the topics that matter most right now: choosing a super fund, debt recycling, and navigating the new tax changes. Download them here Got a question for the podcast? Email us at [email protected] Subscribe to my weekly blog: Stay connected here Important This podcast provides general information about finance, tax and credit. It doesn't take into account your specific objectives, financial situation or needs, so you need to assess whether it's relevant to your circumstances before acting on it. If you're not sure, speak to a licensed, trustworthy professional.