An estate planning strategy involves developing a comprehensive plan to deal with your assets after you die – the legal instruments and structures, such as a will, you put in place to transfer your assets in the event of death.Â
Yes, if you:
General Power of Attorney: A General POA is provided by the Donor to an Attorney or Attorneys. It gives them the authority to perform certain tasks on behalf of the Donor. The authority can be limited to specific tasks such as accessing your bank account.
Enduring Power of Attorney: As in the case of a General POA, an Enduring Powers of Attorney gives the Attorney(s) the authority to perform certain tasks on behalf of the Donor. However, an Enduring POA is more applicable to older persons or persons with significant health issues.
An Enduring POA can also be limited to specific situations. Whereas a General POA would cease to be effective if the Donor loses mental capacity. An Enduring POA, as the name suggests, would continue to be effective in this event.
An Enduring Guardianship document is colloquially referred to as a Medical Power of Attorney. Similar to an Enduring POA, an Enduring Guardianship is more applicable to older persons or persons with significant health issues.
It enables a person with decision-making capacity nominate a close friend or family member to become their Enduring Guardian to make healthcare, lifestyle and medical decisions for them if they lose the ability to make these decisions in the future. However, the person you appoint as your Enduring Guardian must be aged 18 years or older and should have a good understanding of your lifestyle, the things you like and what your future wishes may include.
A binding death nomination is a written direction from a member to their super fund directing the fund how the member wants some, or all, of their superannuation death benefits to be distributed. A binding death nomination must be reviewed and updated every three 3 years unless it is specified as non-lapsing.
If you do not have a binding death nomination signed and lodged with your super fund, then the trustee of the super fund will pay your super benefit to your estate. This means that the distribution will be subject to your Will.
Why is this relevant to your estate plan? You may wish, in your Will, your super to go to a particular person or persons and not be subject to a more general distribution arrangement that you have.
A binding death nomination should be considered as part of your overall estate plan.Â
A legal Will is a document that contains your instructions on how you want your property (including assets such as land, a home, shares, cash etc.) to be distributed after you have died. It is the most important component of your estate plan.
A Will can be very simple, e.g., My spouse receives all my assets unless he/she predeceases me, then it all goes to my children in equal (or unequal) shares. Â A basic Will can cover these simple situations.
The complexity comes in where:
The implications of your testamentary intentions as set out in your Will should be discussed with your accountant, financial planner and lawyer as part of your plan.
There is an ongoing administrative cost of maintaining your estate plan. If you are in a financial position to consider family trusts and SMSFs in the first place, then the cost of the advice to ensure your estate plan can be implemented after your death should not stop you from completing your plan.
A family trust, also known as a living trust or revocable trust, is a legal arrangement that allows an individual (the grantor) to transfer ownership of assets into a trust for the benefit of themselves, their family members, or other designated beneficiaries. The grantor typically also serves as the initial trustee, maintaining control over the assets during their lifetime. However, the trust document will specify who will take over as trustee upon the grantor’s incapacity or death.
The primary purposes of a family trust include:
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Overall, a family trust can offer flexibility, control, and peace of mind in managing and distributing assets both during the grantor’s lifetime and after their death. It’s important to work with legal and financial professionals to create a trust that aligns with your specific goals and circumstances.
A testamentary trust is a trust created by a Will. In most cases the trust is a discretionary trust – one where the Trustees have full discretion about who benefits under the trust and how the assets in the trust are invested.
A testamentary trust is a trust that is created within and by your Will but does not take effect until your death. It differs from a family trust (also known as an inter vivos trust), as a family trust is created by deed and commences during your lifetime.
A testamentary trust may be created using specified assets, a designated portion of your estate or the entire remaining balance of your estate. Multiple trusts may be created by the one Will.
A testamentary trust can continue for a period of 80 years if so required but it is also possible for the testamentary trust to vest at any earlier date if the trustee so decides.
Buy/sell agreements are commonly used in estate planning, particularly in the context of business ownership. These agreements are typically between co-owners of a business, and they establish a plan for what happens to a business in the event of a co-owner’s death, disability, retirement, or desire to sell their interest.
Here’s how buy / sell agreements function in estate planning strategy:
AussieLegal offers a range of estate planning products such as Legal Will Plus, Testamentary Trust Plus, Powers of Attorney Plus, and Enduring Guardianship Plus services to help you plan for end of life. Our experienced estate planning lawyers and paralegals will help you complete your estate planning strategy documents, so you can have peace of mind that you and your beneficiaries are well taken care of should an unforeseen event happens.
Call us on 1300 728 200 to discuss your situation with one of our consultants.
