Source: www.playbuzz.com-
1. Why should I make a will?
… I’m too young.
Whilst death may seem to have preference for people in the older age group, in reality, death does not discriminate. If you’re 18 years and over and own assets of value, sentimental or monetary wise (eg. a house, money in a bank account, jewellery, photos, videos, employment benefits, shares in a company), making a will, will give you peace of mind that your hard earned or valuable assets will go to the people that you want them to go to.
… it’ll all go to my family anyway.
If you die without leaving a will, your estate (all of the assets which you own personally) will be distributed according to a formula set out by the government in the Administration Act 1903 (WA). However, which formula applies depends on who you leave behind. By essentially letting the government ‘write your will’:
(a) you have no control over who gets what assets of yours;
(b) your assets may go to people you may not have intended to benefit (your ‘nearest’ may not be your ‘dearest’); and
(c) there may be people who you may want to leave assets to, but who do not fall under the applicable formula.
… I’ll be dead by that time anyway, what’s the difference?
It can make a huge difference to the people you leave behind.
When you die leaving a will, generally the person named in your will as the executor (the person who will handle the administration of your estate) will apply to the Court for a grant of probate. Probate is a document issued by the Court which certifies that the will submitted is valid and that the person named has the authority to deal with your estate.
When you die without leaving a will, generally a person who has a right to the distribution of your estate will apply to the Court for a grant of Letters of Administration in order to deal with your estate.
Applying for a grant of Letters of Administration is generally more time consuming and complicated than the process for applying for a grant of Probate. The more time consuming an application is, the more administrative costs your estate has to bear, leaving less for the people you leave behind. Not to mention, the more time consuming and complicated the process is, the more frustrated your loved ones will be. By making a valid will, you can help make the transition process a little easier for your loved ones.
2. It’s not the right time, my life is not stable enough. If I make a will, I’ll just have to change it.
A will should be a living document, being reviewed and amended as your life circumstances change. Such life circumstances include:
(a) when you get married, get divorced or have separated;
(b) when there’s a birth or death in the family;
(c) when one of your beneficiaries (ie. people whom you leave all, any or part of your personal assets to) dies or when your relationship with a beneficiary changes;
(d) when your executor dies or becomes unsuitable to act as your executor; and
(e) when your assets or liabilities have changed significantly – eg. the purchase of a house.
A will which does not change as your life circumstances change will defeat a major purpose of having a will – to provide peace of mind that your current last wishes are documented.
3. I already have a will, I’m all set!
Perhaps you are, but perhaps you’re not.
The aim of estate planning is to ensure that your hard earned assets get passed to the people that you choose in a way which would best achieve your goals and objectives. Having an up to date will is a good start. However, good estate planning involves more than just making a will. Why? Because your will only deals with assets which you own personally, either outright or as tenants in common with another person or entity.
Superannuation death benefits and life insurance benefits do not ordinarily form part of your estate. It is possible to direct superannuation and life insurance benefits to your estate and deal with them under your will. However, as with most things, there are pros and cons to doing so and to do so requires careful documentation in your will, with your superannuation fund and with your life insurance provider.
Assets held in trusts, self-managed superannuation funds and by companies are not personal assets and as such, you cannot deal with such assets under your will. Same goes for businesses run through companies or a trust – you cannot pass the business itself through your will. Also, any asset which you own as a joint tenant falls outside of your estate and is not governed by the terms of your will.
Your will does not deal with what happens if you are unable to make legal, financial, medical or lifestyle decisions for yourself. In order to address those aspects of your estate planning, you need to make an enduring power of attorney (EPA) and an enduring power of guardianship (EPG). An EPA gives authority to nominated persons with regards to legal and financial decisions and an EPG gives authority to nominated persons with regards to medical or lifestyle decisions. Like a will, an EPA and an EPG should be living documents, being reviewed and amended as your life circumstances change.
If you would like to make a will, get estate planning advice or have any questions about estate planning, contact a member of our estate planning team on (08) 9228 2881 or by emailing clarissa@equitaslawyers.com.au.
