Beverley has an adult son who is on a disability pension. She asks lawyer Rod Cunich how she can best provide for him after she is gone.
Q. Beverley
I have a 46-year-old son living with me on a disability pension. He has no short-term memory due to brain surgery. He is quite independent, however, but can be easily bamboozled as he retains information for only about a minute. I want to leave him my house but I’m worried he could be conned. His siblings are happy about this as they all have good incomes. They are prepared to help him pay rates and maintain the house. How can I protect him? I understand testamentary trusts are expensive to maintain on an annual basis. I am a pensioner with a modest super, so I won’t have money to leave for such a purpose. Any suggestions are welcome.
A. There are various structures available to you, for example:
-
You could leave your home to your other children but subject to a life estate in your son’s favour which would give him the right to live in the property while he is alive.
-
You could leave the property to a trust for the benefit of your son and managed by your other children.
-
Variations of the first two options.
Each option has its pros and cons for tax and other reasons. You need to consult a specialist lawyer to help you work through the options and find the best outcome for you.
The good news is that solutions are available to you that ensure your son has a roof over his head and that the property is protected.
The cost of setting this up would not be prohibitive, but the arrangements are complex, so you can anticipate it will cost a few thousand dollars.
Perhaps your other children could help you fund the arrangement as they may well benefit by ultimately receiving the property.
Disclaimer: This information has been provided by Rod Cunich and should be considered general in nature. Seek legal advice before acting on this information.
Rod Cunich is a lawyer with over 30 years of experience who specialises in estate planning. If you have a question for Rod, simply email it to newsletters@yourlifechoices.com.au
Related articles:
Threats of disinheritance
Should she be a beneficiary?