Divide your assets, not your family: Three things you need to know about your will 0



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Nobody really wants to know what will happen when they die. It’s scary to think about but it’s important, and more relevant the older you are.

What if you were no longer in the picture, and your hard-earned assets were distributed in a way that you strongly disagreed with?

What if you become unwell or unable to make decisions about your estate?

What if your family had to fight in court, or against each other, to receive what they believed was rightfully theirs?

It doesn’t bear thinking about, but it certainly happens.

A surprisingly high number of people in their 60’s don’t have a will.

Maybe you’ve already written your will and you think you don’t need to consider it any further? If so, don’t stop reading; this article is equally as important for you!

Three ways to help reduce your family’s financial and emotional burden in the event of death

1. Get your will organised now

You could be forgiven for thinking your assets will automatically be divided amongst those you love the most. Maybe you don’t think you have enough assets to even worry about a will?

There are a number of reasons why things might not pan out the way you hoped.

One scenario is a child who divorces (divorces are highest in people aged 50-60, and generally acrimonious).

Imagine you have a $2m estate to leave to your two adult children ($1m each), but one is going through a divorce. If your assets aren’t properly protected, then the divorcing child is likely to lose half their inheritance to their ex-spouse.
And, if your child was being sued, their inheritance would be fair game for creditors.

No one dreams for their life-long assets to end up with strangers.

These are just two of multiple situations that can change your will’s outcome. Also critical is assigning Power of Attorney to someone who can carry out your financial wishes or pay bills, should you become incapacitated. Similarly, documents like an Advance Care Directive allow another person to make medical decisions if you’re unable to.

2. Seriously consider your options

In Australia, will kits can be bought online for under $100 or set up free through The Public Trustee.

With will kits, you can write your own will, but it’s really just about asset division – a child divorcing or being sued will still create problems, possibly requiring legal action to fight for assets.

While free initially, The Public Trustee is likely to charge around 2-3 per cent of the estate’s value after settlement. On a $5m estate, that’s around $150k in fees before the beneficiaries are paid. They also can be slow to settle, which means beneficiaries are kept waiting.

Using professional services to construct your will properly will help provide for unforeseen eventualities and keep your assets protected. A financial adviser can inform you of trust vehicles, such as a Testamentary Trust, where money can sit, untouchable, until a divorce or court case is settled.

Check with your financial adviser – they may provide free estate planning advice before referring you to a lawyer to draw up the paperwork (at a one-off cost of around $2,000).

3. Review your will regularly to ensure it’s current and up-to-date

Finally, don’t forget that the only constant in life is change. Just because you already have a will doesn’t mean it’s going to exactly carry out your wishes, should you pass away tomorrow. Divorces, marriages, deaths, de facto relationships, grandchildren and changes in location and wealth (to name a few) can all alter your view on how you want your assets distributed.

We recommend reviewing your will every five years, or after significant life changes, to make sure it reflects your current situation, and takes into account any tax changes that might be relevant.

Share your thoughts below.

Nicholas Heard

Nicholas Heard, CEO of Heard Financial, has more than 15 years’ experience in the finance and banking industry. He specialises in advising the self-employed, women, business owners and medical professionals in the areas of retirement planning, superannuation strategies, wealth creation and insurance.

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