Talking about, or even contemplating death is not something that many people find pleasant. There can also be a situation where, prior to death, you reach a stage when you can no longer make decisions for yourself, particularly with us all living longer than past generations. Hence the importance of Estate Planning.
It is really important to consider what you want to happen to your assets when you pass away. If you don’t have your Estate plan in place your intended beneficiaries may not get what you wanted them to. Your Estate plan should include a Will and possibly a plan for how you will be cared for medically and financially should you become unable to make your own decisions.
It is estimated that nearly 50% of Australians die without a valid Will in place. In these circumstances a court appointed administrator will make decisions on how your assets are distributed. This is referred to as dying ‘intestate’ and can result in stressful and difficult times for your surviving family.
Estate Planning should be an integral part of your financial plan, to avoid the chaos that can result, especially in the case of your untimely demise. Many people are even unaware that their superannuation does not form part of their estate. A good Estate Plan will include, amongst other things, a Will, Enduring Power of Attorney as well as Superannuation Death Benefit Nominations.t
Now you can get a do-it-yourself Will from a Newsagent or Australia Post, but bear in mind, this is one of the most important documents you will ever sign, so it is worth getting it drafted by a Solicitor. It is also important to update it from time to time, like when your circumstances change e.g. Marriage, divorce, have children or your spouse or beneficiaries pre-decease you.
The Enduring Power of Attorney is a separate document which gives someone legal authority to look after your affairs if you lose capacity to do so. Obviously this would be a person you have absolute trust in. An Advanced Healthcare Directive, or Living Will documents how you would like medical decisions to be made for you should you lose capacity.
As far as Superannuation goes, most funds allow you to nominate who death benefits should be paid to. These can be binding or non-binding. In the absence of a nomination, the funds’ Trustee decides who gets your super. A non-binding nomination guides the Trustee on your wishes whereas a binding nomination is binding on the Trustee and removes his or her discretion.
It is advisable to make sure your Executor and/or Power of Attorney have easy access to important documents to make their jobs easier. You may want to keep important documents together for ease of administration. Some of these may be: