Estate Planning
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Estate Planning
“I want to give my kids just enough so that they would feel that they could do anything, but not so much that they would feel like doing nothing.” – Warren Buffet
As we enter our ‘Golden years’, we may start to reflect on our life and what kind of legacy we want to leave for our loved ones and future generations.
Estate planning provides the opportunity to leave behind a lasting impression. Throughout the planning process, existential questions may well be discovered that had not been considered.
In the next few FP weeklies, we will explore this topic and share a few tips worth considering to ensure your loved ones benefit from your lifelong efforts as much as possible
Address the Basics
It is worth discussing estate planning wishes sooner than most people think, as life can get busy and messy, leaving such important issues until AFTER we are capable of dealing with them:
Make sure your wishes are clear, unambiguous and in writing. Written instructions usually means a Will, but in addition, have a one to two pager ‘plain English’ summary (that your solicitor should tick for consistency with the will) to ensure there is no misunderstanding.
Try to consider highly probable situations, such as, if your partner dies or providing for your children’s needs if they are under 18 (such as who will look after them and whether the carer should be paid).
Having an Enduring Power of Attorney (for financial decisions) and an Enduring Guardian (for health decisions) appointed as well as having a documented Care Plan (dealing with resuscitation, organ donation, and where you wish to be cared for when the time comes). This will give your loved ones a guide, remove the tough decision making and ensure your wishes will be followed.
Share your intentions with your family, so they have a chance to contribute and understand before you are no longer there to influence the decisions.
If you hold a superannuation, ensure any binding death benefit nomination/s are up to date.
Pre-Planning
Here are some pre-planning tips on what you can do help your Executor/s administer your Will when the time comes.
1. Locate and update your executed Last Will & Testament
Your Executor/s can act on behalf of your estate only if they have the original executed Last Will & Testament. It is important to make sure that it is up to date with no pages missing, and pages are signed and witnessed where applicable. Your Executor/s will need this document when they seek probate (if applicable) so make sure they have access to it.
2. Prepare an inventory of all your assets and liabilities
Another document required for probate (if applicable) is an inventory of assets and liabilities of the estate. By preparing the inventory, your Executor/s will have an easier time in preparing and lodging the application for probate. Assets you may have include; bank accounts, properties, shares, cars etc, while liabilities include mortgages, utilities and credit cards etc.
3. Prepare a list of contacts of professionals and advisers you liaise with
Much of the time spent by your Executor/s will be in determining who your contacts are and searching for them. You can help your Executor/s by providing contact details for you solicitor, accountant, financial planner, life insurance provider and anyone you believe is relevant.
4. Organise your title documents
If you are missing any titles for property it is easier to request a replacement now, rather than requiring your Executor/s to do so. Documentation is required to transfer real estate property to the beneficiary/ies.
Instances when you may not have custody of the physical title documents include:
Where they are held by your mortgagee.
Lost over time.
Some Australian states do not issue paper documents of title.
5. List your online accounts
You may want to provide a list of all online accounts together with the login details (usernames, passwords, answers to secret questions) to your Executor/s so that they can close or continue using some online accounts. Online accounts you might have include bank accounts, share registry accounts, utilities accounts and social media accounts.
6. Put these documents in a place where your Executor/s can find them
Last Will and Testament (up to date) and/or Codicil (a document, if required, used to make alterations to an existing Will, if any)
Powers of Attorney, General or Enduring and/or Appointment of Enduring Guardian
Birth Certificate
Marriage Certificate
Citizenship Certificate (if applicable)
Certificates of Titles
Life insurance policies
Share certificates, issuer statements, brokerage statements and other documents of title of your investments
Binding death benefit nominations (up to date)
List of assets and liabilities
List of contacts of professionals
Car registrations
List of online accounts to be operated or closed with details of usernames and passwords