Yet, creating a robust estate plan is one of the most caring things you can do for your loved ones. Consulting with estate planning lawyers early can help you navigate complexities and ensure your wishes are legally sound.
Estate planning goes beyond creating a simple will. It encompasses a range of legal documents designed to protect your assets and ensure they’re distributed according to your wishes. The core components include wills, trusts, and powers of attorney.
Many Australians mistakenly believe estate planning is only for the wealthy. In reality, anyone with assets, dependents, or specific wishes about their property should have a plan in place.
“The greatest gift you can leave your family isn’t just what’s in your estate, but clarity about your intentions for it.”
Creating a solid plan begins with taking inventory of what you own. List all assets including property, investments, superannuation, insurance policies, and personal belongings. Don’t forget digital assets like online accounts and cryptocurrencies.
Next, define your beneficiaries clearly. Consider who should receive specific assets and any special conditions you want to place on inheritances. This is particularly important for blended families or when providing for vulnerable beneficiaries.
Your executor will be responsible for carrying out your wishes after you’re gone. This role involves locating assets, paying debts, filing tax returns, and distributing property to beneficiaries.
Look for someone who is trustworthy, organised, and willing to take on the responsibility. Consider their age, health, location, and financial knowledge. Some people choose professional executors for complex estates.
A valid will in Australia must be in writing, signed by you, and witnessed by two people who aren’t beneficiaries. Beyond these legal requirements, a good will clearly states:
Life changes constantly, and your estate plan should adapt accordingly. Major life events that trigger a review include marriage, divorce, birth of children or grandchildren, significant changes in assets, moving interstate, or changes in tax laws.
Schedule regular reviews every 3-5 years, even without major life changes. This helps catch outdated provisions or adapt to new legislation.
Trusts offer additional protection and control over how assets are managed and distributed. They can help minimise estate taxes, protect assets from creditors, provide for beneficiaries with special needs, and manage wealth across generations.
Common trusts in Australia include testamentary trusts (created by will), discretionary trusts, and special disability trusts. Each serves different purposes and offers unique advantages.
Many estate plans fail due to simple oversights. Digital assets are frequently forgotten, yet they can have significant financial and sentimental value. Create an inventory of digital accounts, passwords, and instructions for handling these assets.
Another common mistake is failing to update beneficiary designations on superannuation accounts and life insurance policies. These designations override your will, so keeping them current is essential.
While Australia doesn’t have a specific estate or inheritance tax, other tax liabilities can impact your estate. Capital gains tax, superannuation death benefits tax, and income tax can all affect what your beneficiaries ultimately receive.
Strategic planning can help minimise these impacts. Options include holding assets in tax-effective structures, making superannuation binding death benefit nominations, and timing asset transfers efficiently.
Estate planning involves complex legal, financial and tax considerations. Working with professionals who specialise in estate law ensures your plan complies with current legislation and achieves your objectives.
When selecting an estate planning attorney, look for experience in your specific situation, clear communication skills, and transparency about fees. Initial consultations can help you gauge whether they’re a good fit.
A resilient estate plan provides peace of mind that your loved ones will be cared for and your wishes respected. By taking time now to create a comprehensive plan, you protect your family from unnecessary stress during an already difficult time.
Remember that estate planning isn’t a one-time event but an ongoing process that evolves as your life changes. Take the first step today by consulting with Tonkin Legal to create a plan tailored to your unique circumstances and goals.
Read more:
Building a Resilient Estate Plan in Australia