Advivo Accountants and Advisors advise the importance of having an estate plan in place.

 

All too often when we talk to people about estate planning, we hear responses such as:

“I don’t have kids”

“I set one up years ago”

“I don’t have enough assets to create one”

“I used a kit I bought online”.

Estate planning is not only for the rich, everyone can benefit from having an estate plan to ensure your intended beneficiaries are the ones who, in fact, do benefit of your Estate. Having an effective and well-thought out estate plan can provide some certainty during a major life event. Failure to properly plan the disposition of your estate can result in a range of unintended consequences – some of them undesirable to the people you care most about!

Let’s take a look at some common scenarios:

Single, with no assets and no kids

  • Life Insurance held in Superannuation is often a significant ($100,000+ asset). Wouldn’t you want that to go to somewhere meaningful to you?
  • Having a will means that the family do not have to spend thousands or tens of thousands of dollars and lots of time applying to court for their estate to be administered. Isn’t that worthwhile to remove that stress and cost for family?

Married or living in de facto relationship, did my Will before the relationship

  • Unless made in contemplation of the relationship/marriage, a will done beforehand will be invalid. This may mean that family rather than your loved one ends up with your assets. They won’t necessarily give these assets to your spouse.

Family

  • Guardianship of children – your estate plan can set out who gets legal and financial custody of your children and their assets. Without this, family members would need to apply to the court and demonstrate why they should be granted custody. If multiple people are applying your children could end up being bought up by someone you don’t want them to be.
  • Testamentary trusts for children under 18 are also a vehicle that are created in an estate and can achieve significant tax savings on income earned from your estate assets. This means that there is more money available for your children to be looked after.

Divorced

  • If your last will was whilst you were married to your ex-spouse then they will get everything!

I have a business with a PTY LTD company or controlled by a family trust

  • Control of these structures is important and unless this is built into your estate plan then it won’t always end up where you want it to. That can be a terrible outcome for your business, or your family, and the legacy you worked hard to create during your life.
  • These structures do not necessarily form part of the estate. How these integrate with one another is a very important part of estate planning and where your accountant and estate lawyer need to be on the same page or you can end up with unintended outcomes – leaving a mess behind to be sorted out by your family and business colleagues.

A comprehensive estate plan can help you feel more confident about the future, knowing your loved ones will be taken care of and that the legacy you leave behind is the one you want. An estate plan is customised to meet an individual’s current and future goals for their assets. If you haven’t yet incorporated an estate plan into your overall financial plan, consider the following reasons why it is important to talk to an advisor sooner rather than later:

  • To plan for your own needs
  • To dispose of wealth in the manner you wish
  • To minimise transfer taxes
  • To plan for philanthropic goals
  • To protect family wealth
  • To prepare future generations for the wealth they’ll receive.

Ultimately, the degree of estate planning complexity depends on the size of your estate and type of assets you own. It is also important to remember that an estate plan is most effective when you keep it as current as possible, so ensure you periodically review and update your existing estate plan.

An estate plan can include documents such as a will, living or revocable trust, personal property memorandum, enduring power of attorney, healthcare proxy/agent or power of attorney, and a living will. While it’s important to have the correct documents in place, depending on the complexity of your estate, it may also be beneficial to have a team of financial professionals to help guide you through the process.

Our Accountants and Advisors here in Advivo are well placed to assist our clients with their estate planning, as we are familiar with the structures involved and can more easily consider the impact of estate planning considerations on the other important areas of asset protection, business succession planning, and tax efficiency*.

We can do this using sophisticated new tools that allow us to plug into estate planning lawyers utilising technology that keeps your cost down and achieves a better result for you by ensuring your key advisors are all involved in the process. This delivers the best holistic estate plan for you so that you can have peace of mind that things will be the way you want them to.

*This information is general information only and has been prepared without taking into account your personal objectives, financial situation or needs. The information provides a high level summation of selected parts of legislation only. The legislation is complex and includes a number of conditions and overrides that may apply to individual situations. Interpretation and application of the information to your specific circumstances requires consultation with an accountant with a detailed understanding of your personal and taxation affairs and a qualified financial advisor before taking any action.
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Talk to Us

Here at Advivo, we are well placed to assist our clients with their estate planning, as we are familiar with the structures involved and can more easily consider the impact of estate planning considerations on the other important areas of asset protection, business succession planning, and tax efficiency. Contact us today at 07 3226 1800 or email us at info@advivo.com.au for more details.