Wills and Estate Planning Adelaide: Estate Planning to Show Your Family You Love Them

Estate Planning to Show Your Family You Love Them

How can you show your love for your family even after you are gone? None of us knows what the future holds. My godfather died in his 20’s and he left his young wife with a 3 month old baby to take care of. It doesn’t matter what stage of life you are in, you need to be prepared.

Here are a few practical steps to help you be prepared from a financial and administrative perspective.

1. Create a legal Will and keep it up to date.

Even if you don’t think you have a lot of assets, you need to have a Will because you don’t want the government to dictate what happens to your property after you are gone. It will save your family a lot of time and grief, because getting an estate in order after someone has died without a Will can take a lot of time and money.  You may be surprised by how many possessions you own … Super, life insurance, a car … it all adds up.

It is important to discuss who will care for your children if something should happen to both parents. It is certainly a hard decision and there are many factors to consider.

Don’t risk a DIY Will-kit. They are little more than expensive pieces of stationery, and offer no backup or support. They even say on those kits that they are not intended as a substitute for legal advice!  They are the cause of a growth-area in estate-litigation, because so many people make mistakes with them. The problems will only show up after you’re dead and gone.  Then it’s your family & loved ones who have to wear the cost and all the delay and heartache to try to fix it all afterwards.

Wills and Estate Planning Adelaide: How Estate Planning Trusts Can Protect You and Yours

How Estate Planning Trusts Can Protect You and Yours

Estate planning and trusts are all about planning, not only for your own future, but also the financial well-being of your family and loved ones after you’re gone. However, the reality of life can often get in the way of a smooth transition – divorce, second marriages, step kids, long-term illness and other family changes can sometimes make life and plans unpredictable.

Protecting your wealth & assets and the financial well-being of your family is about a lot more than simply parcelling-out your assets – it’s about providing for yourself & your family members in a way that’s responsible and specifically addresses your personal situation.

Many people make the assumption that estate planning and trusts are only for incredibly rich people. That is wrong.

A family discretionary trust is a very versatile estate planning tool that allows you to address inheritance goals for your beneficiaries – who may still be children, are disabled, are from a mixed family  – and a trust might be the answer to difficult questions like who will manage your assets if you or they become incapacitated.

Typically, when a child inherits money, it is invested for him and held until he or she turns 18 or older. Of course, giving a young person access to a large amount of money at the age of 18 can be dangerous and detrimental to their long-term financial health if they lack maturity or sufficient financial wisdom.  Some parents think that the lure of fast cars and endless parties may be too great a temptation for their beneficiaries to handle at age 18, and so they specify an older age, frequently 21 or 25.

Intestacy: How Property is Distributed without a Will

When a person dies without a Will, this is known as dying “intestate”.  This might happen because their death occurs before they even considered writing a Will. Some people feel that they don’t need a Will because they don’t have a substantial estate. A person might write a Will, only to have a Court declare it invalid after they die, which has the same legal effect as dying without a Will at all.

When a person dies without a Will, the law has to find a way to distribute that person’s property. In some parts of the world, the government will take most or all of the deceased’s estate, but in most western countries there is a strong preference in the law to keep property in the family of the deceased, generally leaving it to the closest living relatives.

The exact order of priorities among relatives differs from state to state in Australia, but the goals of intestacy law (keeping property in the family) are broadly the same, so the schemes in each State are usually quite similar.

Often the surviving spouse will receive the first “piece” of the deceased’s estate. The value of this piece varies over time.  For example, in South Australia for many years the surviving spouse in an intestacy would receive the first $10,000 plus a percentage of the remaining estate. In February 2009, the law in South Australia was changed to increase this to $100,000 plus a percentage of the remaining estate.

Wills and Estate Planning Adelaide: Comfort = Complacency?

As Baby Boomers start to keel-over, we are about to witness the greatest “transfer of wealth” ever in Australia’s history. This segment of society is a BIG chunk of our national population, and it represents a massive percentage of our private net-worth as a nation.

While this is happening, the Gen-X and Gen-Y youngsters are growing-up fast, and realising for the first time that bull-markets don’t last forever.  They now have new burdens of responsibilities to their own kids coming through behind them.  They are suddenly recognising that life doesn’t owe them, and they’ll have to work for what they want.  It will be interesting to see how they cope.  They’ve been raised in very good times, when the equity in our homes unlocked a never-ending orgy of consumerism.  Who needed to save, when debt was so much easier, and capital gains would take care of that.  Why delay gratification, when the latest big-screen home-theatre can be installed today, with payments over the next 10 years?

But now we are formally acknowledged to be in a debt-fuelled recession.  Our economy has been very kind to us for a long time, and people have become used to a certain level of comfort and security – but that is no longer guaranteed.

So how will you look after yourself and your family in these challenging times?  Have you created a fully-integrated estate plan, and reviewed it regularly?  Have you taken the steps necessary to preserve your wealth for your old-age, and to pass your assets onto the people you care about, or are you simply hoping to live forever?

Death & taxes, illness & share-market corrections may be unavoidable … but they don’t have to ruin your family or your business.  Make the effort to protect the people you really care about.  Call Genders & Partners for integrated estate planning in Adelaide and all over South Australia. And do it NOW … before it is too late.

Wills and Estate Planning Adelaide: Asset Protection – Be Smart, Be Safe

Asset Protection – Be Smart, Be Safe

Asset protection is a valuable and important part of a modern integrated estate plan. No matter how many assets you have, you should make an effort to protect them, but try to avoid these common mistakes:

1. Incorrectly registering or “titling” your assets. In my work, I see many clients who are convinced that their assets are appropriately titled, only to discover serious errors upon checking. This is often a case where the weakest link in the chain (maybe some teenage clerk at a busy registry office) has mis-described the asset or its owners. Correct registration of assets is critical to the ownership & control tests which underpin all of your legal protections.

2. Deferring or delaying your protection planning. If you wait too long, it will be too late. Like insurance, you generally cannot apply for protection after the disaster has already struck. The longer your asset protection plan has been in place, the stronger it is likely to be. It will also cost less to do the planning long before you have a problem. Once a lawsuit has been filed against you, any transfers you make thereafter can be prevented or overturned. Make sure you have your asset protection plan in place and up to date long before you need it.

3. Mistakenly committing fraudulent transfers. If you try to transfer assets to a friend or family member in order to avoid losing them during a settlement, you may find that the courts can reverse the transfer and hold the parties to the transfer partially responsible for criminal &/or civil penalties. People really have gone to jail for attempting this. However, if the transfer is done carefully, and well before any litigation arises, then this strategy can be made to work in certain circumstances.