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Wills and Estate Planning Adelaide: Estate Planning for Blended Families – More Important Than Ever

Estate Planning for Blended Families - More Important Than Ever

If you are in a second or subsequent marriage that involves different sets of children, then you have a blended family.

If you are planning to start a new life, and maybe buy a home with your present spouse, then this time around you really need to develop an integrate plan to ensure that all the important people in your life receive their fair share of your assets after you die.  That’s what modern integrated estate planning does.

In most Australian jurisdictions, divorce will invalidate all gifts to an ex-spouse under a Will.  However re-marriage will automatically revoke the entire earlier Will (with only rare exceptions).

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Wills and Estate Planning Adelaide: Complications in Estate Planning Following Remarriage

Complications in Estate Planning Following Remarriage

Estate planning following remarriage after being widowed or divorced is complicated by a number of factors, including differences in asset-ownership between the parties, one or both of them having children by an earlier relationship requiring provision/protection, disparity in ages, and concerns about the financial effects of a relationship breakdown (once bitten, twice shy).

Joint ownership of assets, and Family Law considerations of “Community Property” can give a surviving spouse certain property rights which can cause problems for the children from prior marriages.

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Wills and Estate Planning Adelaide: 10 More Reasons to Make a Will in Adelaide

10 More Reasons to Make a Will in Adelaide

If you die without a Will, you are deemed to have died “intestate” and your estate will have to be administered at Court in accordance with an inflexible statutory formula which will determine where your estate will go. This can result in unintended results for some people, perhaps contrary to what they would have wanted.

Many people believe that if they are married and they die without a Will, all their property will automatically go to their surviving spouse. That is frequently NOT the case in Australia.

If you are married, all jointly-owned property will pass by right of survivorship to your spouse.  Matrimonial property (essentially property acquired during the marriage) will also generally go to your spouse.

However, if you also have one or more children, state law will provide a formula which will direct the share of the separate property (property acquired before marriage or inherited during the marriage) which will go to each of them. This can be an unintended result if the estate is modest and your surviving spouse needs all the estate-assets to make ends meet.

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Wills and Estate Planning Adelaide: SKI and Estate Planning

Are you familiar with the term SKI ? It stands for Spending Kids’ Inheritance.

A wealthy & successful businessman of my acquaintance claims that his estate plan consists of spending everything to such effect that his final cheque (to the funeral director) bounces.

Here are some reasons why you may receive a smaller than expected inheritance:

1. Your parents are spending it all. Not intentionally maybe, but with the high cost of living, medical care, and long term care, their nest eggs may not be what they used to be. Nursing home costs can run as high as $80,000 a year or higher in some facilities and long term health care may be too expensive.

2. We are living longer than ever, and as we live longer, we consume more of our wealth.  Australians now enjoy nearly the highest life expectancies (on average) in the world – significantly higher than even the UK and USA.  However this means that the duration of our elder care is longer; the amount of care required is greater; and the costs of such care grow ever higher.

3. Medical science continues to uncover treatments for once-fatal illnesses.  When coronary artery disease or cancer strikes, our survival rates today are many times higher than they were just 20 years ago.  However the cost & complexities of many new treatments & medications can erode even the largest savings.

4. Baby boomers come from families that were larger than today’s families. Parents of children born between 1946 – 1964 had an average of 3.5 children, thus leaving a smaller piece of the pie to be inherited by each child.

The End of Life Debate in Australian Estate Planning

Wills and Estate Planning Adelaide: The End of Life Debate in Australian Estate Planning

In June 2010 the Supreme Court of South Australia Court effectively granted an elderly woman’s wish to die.

The End of Life Debate in Australian Estate Planning

The woman was in her 70s and confined to a wheelchair. She instructed her nursing home to stop giving her food and drink and the drug insulin, knowing she would die.

She clearly asserted her right to refuse to take food and medication. The Court case was instigated by the Nursing Home in which she resided, because of concerns that her carers might face prosecution for assisting in a suicide or committing other crimes if it complied with her desires.

The judgment is a first in South Australia and reflects a similar ruling in Western Australia in 2009, where the Chief Justice of the Supreme Court of Western Australia, held that Christian Rossiter be allowed to withdraw nutrition & medication, even though the undoubted consequence of this would lead to his death.

Rossiter had become a quadriplegic after a road accident, and retained full ability to understand his condition and to make reasoned choices on his own behalf. His fully functioning mind was trapped within a body which was unable to undertake any basic human functions’. Nutrition was provided to him through a tube inserted directly into his stomach.

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Wills and Estate Planning Adelaide: Glass Ceilings, Black Holes, Budget Deficits & Estate Plans

Glass Ceilings, Black Holes, Budget Deficits & Estate Plans

Australia now has its first female Prime Minister.  The glass ceiling has at last been shattered.  But what does this mean for the federal budget, and how might this affect your estate planning?

Bear with me for a minute, as we explore some of the possibilities.

That the new PM is female is largely irrelevant to these considerations.  But the change of Prime Minister allows the government to distance itself from some of the more unpopular policies of the outgoing PM Kevin Rudd, notably the Mining Tax.

The 40 per cent resource super profits tax – known as the Mining Tax – was the single biggest tax impost since the introduction of the GST.

This new tax on mining profits was supposed to be worth up to $12 billion a year, and was the government’s funding mechanism to boost the retirement savings of workers, lower business taxes and build infrastructure – while still leaving room for the other $2.6 billion in election promises.