Let’s face it: no-one likes to think of death, especially their own. It’s not exactly a great conversation starter, is it? This might explain why so many people end up “dying Intestate” which means they die without a will and, as a consequence, have their assets distributed according to State law.
Sadly, the way State law distributes a deceased person’s assets among family members can often be a lot different to the way a deceased person wanted their assets distributed
It can create a lot of unnecessary stress and conflict within a family.
So unless you’re living as a hermit with no contact or relationships with others, and you also don’t have a single possession to your name, you need to not only think about preparing a will, but do something about it.
And you need more than just a will. You need an estate plan.
Why having a will is not enough
If you have a will in place, you may not think you even need an estate plan. After all, your will spells out your “Who gets what” instructions regarding your estate, right?
Unfortunately, the estate you’ve specified in your will may not include all of your assets. By law, your will doesn’t include assets such as:
- jointly-held property
- proceeds of life insurance policies
- assets held in trust
- company assets.
To control what happens to these assets, you need an estate plan.
6 more reasons to have an estate plan
A well-written estate plan can do more than just distribute all of your assets the way you want. It can also help:
- Your beneficiaries (i.e. your loved ones) to reduce (if not eliminate) tax on the income generated when they receive their inheritance, and every year thereafter
- Protect your beneficiaries’ inheritance from unfortunate events such as divorce and bankruptcy
- Minimise or even avoid the death benefits tax when distributing your superannuation benefits
- Guard against a beneficiary wasting their inheritance because of their spending habits, mental health, drug addictions, gambling or other vulnerabilities
- Make capital gains tax savings on the assets distributed through your estate
- Ensure your assets are passed to your preferred beneficiaries rather than, say, an in-law or former spouse.
Who should help you create your estate plan?
While an estate plan is a legal document, its creation shouldn’t be left solely to your solicitor. You need someone who knows about you, your family and your financial situation.
And the person who generally knows the most about that is your accountant or financial planner.
However, while they may know all about your finances, they may not have the legal qualifications needed to create a watertight estate plan. So you actually need your accountant or financial planner and a solicitor.
At q4 financial, we work with a number of law firms who specialize in Estate Planning and make this process as painless as possible.
Our main goal is to preserve as much of your estate as possible which allows you to leave your loved ones a legacy that will help them into their futures. The simplest way to do this is to protect the assets you have by (a) losing as little as possible in tax by having a tax effective structure; and (b) protecting it from those who you do not intend to benefit from it.
Avoid leaving a trail of chaos behind you
Whether or not you have an active will in place, without an estate plan there’s no telling who your assets may end up with. Avoid creating stress and conflict for your loved ones, and give yourself the peace of mind in the here-and-now that your affairs are well in order. Get in touch and we can start the ball rolling to get a solid estate plan in place for you and your family.
A CPA and Director of q4 financial, Grant Titman brings leadership and the disciplined energy of an endurance runner to deliver ‘big picture’ outcomes for his firm and his clients.
Grant’s expertise includes and extends well beyond achieving profitability and growth for his clients’ businesses. His focus is squarely on helping his clients to achieve three key goals: extract wealth from their business; set and achieve long-term wealth objectives; and ultimately, enjoy financial freedom.