It is often said that death is final. However, a grieving family knows only too well that the death of a loved one can trigger events that may drag on for years afterwards, especially when it comes to sorting out the estate of the deceased person.
Outlined below are some suggestions that may help reduce the burden on those you leave behind.
Prepare a will
A properly prepared will is one of the crucial elements of your estate planning. Your will should not only state how your assets are to be divided, it should also nominate an individual (the executor) who will be responsible for carrying out your wishes. When preparing a will, it is important that you make adequate provision for your dependants, and document the reasons for your decisions to help minimise the risk of your will being contested.
Consider an advanced health directive
Advanced health directives are another important tool in the estate planning toolkit, as they enable you to give detailed instructions in relation to your health care, including decisions on any treatment you wish to receive or refuse, if you are incapable of communicating those instructions.
Establish a Power of Attorney
Whilst a will deals with your estate upon your death, Powers of Attorney are designed to deal with your affairs while you are still alive. Powers of Attorney enable you to appoint an individual to deal with your affairs if you become incapable of making your own decisions. Powers of Attorney can be as wide ranging or as limited as you require or desire.
Appoint a guardian for children
If you have young children, make sure you appoint a guardian to care for them. In doing so, you can provide that guardian with guidance about your child’s upbringing, and make provisions for your children’s financial future using the most tax-effective means available.
Make binding death nominations
It is also important that binding death benefit nominations are made on superannuation and retirement income stream products as they ensure these funds bypass an estate, and in so doing, be excluded from any claims against an estate. And make sure yours is current.
Cover those assets not covered by your estate
One of the most common mistakes made in estate planning is leaving no instructions for those assets not covered by your estate, such as assets held in trusts and companies. Separate provision needs to be stipulated to ensure that control over these assets passes on to those you intended.
Other estate planning mistakes to avoid include:
- writing an informal will and not having it witnessed,
- not keeping your will up to date,
- assuming your superannuation will bypass your estate,
- not telling people where your will is located, and
- using beneficiaries as witnesses to your will.
This list covers a lot of the most important things to consider. Professional advice should, however, be sought to tailor your estate planning arrangements to your unique circumstances. Then you can get on with living your life.
Estate Planning Essentials, Hillhouse, Burrough, McKeown Lawyers