What is Estate Planning and Why Do I Need One?

What is estate planning?

Estate planning is more than simply making a Will. It is the process of anticipating and arranging for the management and disposal of your estate during your life and after your death.

It should provide you with peace of mind that your family will be secure if something happens to you. If well-crafted it can minimise any tax paid by your heirs and help avoid any family disputes. It should also include documents that govern how you will be cared for, medically and financially, if you become unable to make your own decisions in the future.

Every family is different and it needs consideration of all aspects to determine the best plan.

Estate planning is also vital to any financial plan. A good estate plan requires the involvement of skilled legal, accounting and financial specialists to ensure the right funds get into the right hands at the right time.

Laws change so your estate plan needs to be regularly reviewed and updated to ensure it is still achieving what you want it to achieve.

Some of the major estate planning tasks include:

✓ Understanding your assets and what can be done with them upon death
✓ Creating a Will
✓ Limiting disputes by setting up trusts for beneficiaries transferring assets now
✓ Establishing a guardian for living dependents
✓ Naming an executor of the estate to oversee the terms of the will
✓ Creating/updating beneficiaries on plans such as life insurance & superannuation
✓ Setting up funeral arrangements
✓ Setting up durable power of attorney (POA) to direct other assets and investments
✓ Placing assets outside of your estate to avoid litigation

Transferring the family farm or other businesses has never been more affordable

Recent changes to tax legislation and stamp duty rules has made now an excellent time to consider how you want to manage the family farm or business for the future. Up until now tax consequences and stamp duty have made this unviable for many families but the new rules are making a big difference. Previous rules were very strict but now there is a lot more flexibility if your farming or other business meets certain criteria.

So if you have ever discussed selling or gifting the farm or your business to family members now is the time to talk to us about the new rules.

How do I avoid my family fighting over my will?

In our modern world families no longer accept their loved ones’ decisions as set out in their will and more and more people are commencing court action against estates. The costs both financially and emotionally to families is enormous. Proper estate planning involves more than drafting a will. Considering transferring your assets to entities that are not impacted by your will, managing superannuation and debt and generally letting you know where the risks to your estate plan lie and how they can be minimised is an essential part of the estate planning process.

Managing family expectations and then setting up your assets in entities that are difficult to contest when you die is one of the many ways we can help ensure that your wishes are put in place. Traditionally some of these options were very expensive but new taxation and stamp duty provisions have made estate planning far more affordable.

I have a great estate plan in place so what else can go wrong?

It is also important to consider how your assets are dealt with if you lose the capacity to make decisions for yourself. It is amazing how often a great estate management plan can be affected by an attorney dealing with assets without considering the impact on your will. Many fail to consider these implications and a ‘standard’ or ‘kit form’ power of attorney can be as disastrous as a will kit. Worse still if you have no power of attorney the courts determine who will manage your affairs and often will appoint the Public Trustee. Can a stranger manage your assets for you???

Call Wright Clarke Solicitors on (07) 4992 2722 to arrange an appointment to discuss your Estate Plan today.