Estate planning: is your will in need of a review?

Jack made his will several years ago and thinks it may be in need of an update.

Senior man writing his will

As with many Australians, Jack made his will several years ago and now that his children are adults, he asks legal expert Rod Cunich if he needs to make a new one.

Q. Jack
My wife and I made our wills when our kids were very young and naturally, we are each other’s beneficiaries, with our assets transferring to our children once we both die. Our children are now adults and our assets and estate have changed. Do we need to make another will?

A. Jack, everyone should review their will whenever there is a significant event in their family or financial circumstances, such as:

  • The death of a spouse, a beneficiary, or your executor.
  • Children attaining the age of 18 years (you may wish to appoint them as backup executors).
  • Marriage, divorce or (often overlooked) a separation – whether yours or a beneficiary’s.  You don’t want your hard-earned wealth to become part of your child’s family law property dispute.
  • Entering into a blended family situation, where it often becomes complicated to ensure that a new partner and children from prior relationships are appropriately recognised.
  • The sale or purchase of a major asset, such as a home or investment property.
  • The signing of a superannuation Death Benefit Nomination, the creation of a pension or retirement.  Superannuation death benefits often by-pass your estate so are not covered by your will.  Alternatively, you can direct them into your estate so they are controlled by your will.  Understanding which option best suits your circumstances is critical for asset protection and taxation purposes.
  • Obtaining life insurance – again the proceeds may bypass your estate and not be controlled by your will. As with superannuation, this may or may not be a good thing.  You should understand the consequences so you can control and direct the outcome, as they can deliver very different results.
  • Creating new structures, such as a company or trust, and understanding the consequences of assets held by those structures not forming part of your estate.
  • A beneficiary suffers a disability or falls on hard times for any reason, including bankruptcy, addiction to drugs or gambling. 

Many events don’t require changes to a well-prepared will but you should at least check if the event does require an amendment. It is often the one time you don’t check that is likely to bring your affairs unstuck.

In the absence of a significant event, I recommend everyone revisit their will at least every five years. Laws are amended and there may be subtle changes to your circumstances that may have an impact on the wishes expressed in your will or your broader estate planning wishes.  

It’s not just your will that requires review
Even if your will doesn’t require changing, your review may highlight related issues you need to address to ensure your estate planning achieves your wishes. For example, identifying and managing assets that may bypass your estate and the consequence of how assets are owned (solely, jointly, in super or through companies and trusts), are issues that may have an impact on the effectiveness of your will, but may not require a change to your will.  Often you may need to make changes to your super structure, your insurances or your asset ownership structures in order to ensure your will can actually achieve your wishes, or that you achieve your wishes (in part) outside the reach of your will.

In this complex world of ours, your will is not the only consideration to which you need to turn your attention. Your five-yearly review should cover the full range of your family and financial circumstances, addressing all those issues that have an impact on your estate planning, but may not be covered by your will, regardless of how up to date it is. This type of comprehensive review will require you to fully inform your solicitor so that all your affairs can be considered, not just those covered by your will.

So Jack, simply put, it’s time to review your will and your broader financial affairs.

Rod Cunich is a lawyer with over 30 year of experience who specialises in estate planning. He is the author of Understanding Wills and Estate Planning, a practical book written for the layman.

Rodcunichlawyer.com.au

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    COMMENTS

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    12th Jan 2017
    11:01am
    Yet another ad for lawyers, one of the world's sleaziest professions.

    We need to be able to make wills without lining the pockets of lawyers.
    ozirules
    12th Jan 2017
    11:21am
    I agree, Barak. I also believe that a will should be non contestable. The wishes of the deceased should be carried out regardless of what others think should be more appropriate distribution of an estate.
    Anonymous
    13th Jan 2017
    6:29am
    I agree ozirules. It's a absolute disgrace that someone who abused the deceased, robbed them, or behaved so irresponsibly and dishonestly that the deceased felt compelled to exclude them from a will can BLACKMAIL the executor by threatening a stressful and very costly legal battle if they are not paid to settle a ''Family Provision Claim''. What is even more disgusting is that the competing means of heirs is permitted to largely determine claims. So the drop-kick dishonest son who borrowed money (undocumented - because it was from dear old Dad who mistakenly trusted his kids) and never paid it back claims hardship and gets the bulk of the estate while the responsible son who fixed up Dad's house for him, ran his errands, drove him everywhere, paid bills for him when he was short of cash, etc. (but again, undocumented, because who gets their parent to sign acknowledgments that they did XXX and yyy for them in their old age?) gets shafted.

    12th Jan 2017
    11:07am
    The Public Trustee is the one to see.
    Slimmer Cat
    12th Jan 2017
    3:48pm
    Yes they'll write you a FREE Will but that is the last thing that will be FREE.
    Don't decide that you want your own executor and no matter what you have said in the WILL, your executor is the Public Trustee.
    They charge like a wounded bull.
    You won't be here so it won't worry you but that house that has been so protected will slowly disappear.
    Slimmer Cat
    12th Jan 2017
    4:13pm
    BTW - it is no longer the Public Trustee and has, for a number of years, been the NSW Trustee and Guardian.
    It is a private company - privatized when the NSW Government sold off the Public Trustee.
    Anonymous
    12th Jan 2017
    4:19pm
    Slimmer cat do you know if they are better than the public trustee or do they also also charge like wounded buffalos?
    Lucky Lady
    12th Jan 2017
    5:10pm
    Fast Eddie, I'm organizing our wills now, so am keen to know why you recommend The Public Trustee please?
    Is one of the main reasons because they actually keep a person's will registered as 'on record', hence it's easily located when needed?
    I asked my mum's solicitor if he sends off client's wills to be registered & he said no solicitors don't, as there's no such 'will register' service - so simply the client & solicitor have a copy.
    Am thinking if our solicitor dies before us then what happens to their copy?..it's probably just destroyed... so envisage we'd all better make sure we keep our original wills in our clearly labeled & easily found 'important stuff' folder & give copies to our appointed will Executer/s, Power of Attorney/s, Guardian/s & main Beneficiaries too!..so our wills are easily 'found' when needed!
    I'm unsure of the benefits of going with The Public Trustee? but otherwise it appears that it pays off to 'shop around' for a solicitor! Mum's solicitor (in his nice 'posh' Sydney suburb office) asked if we wanted him to do our wills, at a cost of approx. $1,200 each = $2,400 for both of us! yeeks..So I called into a 'very modest' local suburb solicitor's office for 'a quote' - $900 'all up' for the two of us incl Power of Attorney etc & after explaining that we are on a 'limited low income' the quote was reduced to $750 for us both!...big difference compared to $2,400!
    I might add (for the benefit of others too) that my mum's solicitor when 'finalizing her will' (after her passing on) charged 'like a wounded bull' for his services! Mum had followed his previous advice of disposing of her main cash assets to her beneficiaries, prior to passing on (she was a self-funded retiree, house sold - proceeds pre-distributed, living with a daughter) leaving only about $12,000 in her account, which he knew! Guess what his bill came to? yep, $11,286! Co-incidence/or not? One interstate family beneficiary of considerable shares rang this solicitor to find out when these shares would be transferred to them & as it was taking soo long they made 5 x more follow-up calls - solicitor on his 'final bill' charged $150 'per phone call he received' re this = $900 for 1/2 hrs work conversations in total re this!
    This has understandably left me 'perplexed' re the difference between using a solicitor's services versus using The Public Trustee, so any personal use/ benefits/ knowledge will be greatly appreciated? Many thanks.
    Slimmer Cat
    12th Jan 2017
    6:28pm
    There is no such thing as THE PUBLIC TRUSTEE. In NSW it is now the NSW Trustee and Guardian probably something similar in other states. It is a private company.
    On the death of your solicitor your will will be dealt with by whoever buys the business or you can take your will and move it to wherever you want it moved. Always keep a copy with your own papers.
    If The NSW Trustee and Guardian writes your will THEN they only are your executor no ifs or buts.
    Slimmer Cat
    12th Jan 2017
    6:30pm
    The name was changed to the NSW Trustee and Guardian as people wrongly thought it was a PUBLIC COMPANY.
    Slimmer Cat
    12th Jan 2017
    6:36pm
    As I stated earlier the NSW Trustee and Guardian will write you a free WILL and that is the last thing that will be free. Everything from here on will be charged at Solicitors rates. Once you die they will administer your Will and will get back in costs far more than a local solicitor would ever charge you, as they have to bring in valuers and value every item in your home before Probate is charged.
    Anonymous
    12th Jan 2017
    7:09pm
    Lucky Lady, Slimer Cat "may" be correct about the situation in NSW, but I live in Queensland and here the Public Trustee does NOT charge to draw up your will, NOR are they the executors of your will. YOU choose your own executor/s. Yes, they do keep your will on record for any emergencies in notifying the relevant parties in case of your demise. They also contact you on a periodic basis as a reminder for alteration purposes which you may have forgotten to notify them. The Public Trustee employees who confer with you about your will are qualified solicitors who explain everything in (sometime agonising) detail, are professional, polite, courteous, and exacting. Do NOT fully trust ANY comments or advice on this site (including mine) when it comes to something as important as your will. Go into Google, Dolphin, or Safari and look for "Public Trustees" for the information you require. Charges and fees are also listed. I am not a pauper and have worked long and hard for my money and certainly wouldn't leave it bequeathed in a manner which was not iron-clad to my satisfaction. Good luck and God Bless You.
    KSS
    12th Jan 2017
    12:39pm
    "My wife and I made our wills when our kids were very young and naturally, we are each other’s beneficiaries, with our assets transferring to our children once we both die. Our children are now adults and our assets and estate have changed. Do we need to make another will?"

    I cannot believe this was a serious question!

    13th Jan 2017
    9:22am
    Just be aware, friends, that NOTHING you put in a will is going to stop unconscionable people BLACKMAILING your executor (whoever that may be) to give them an unfair payout or lose up to $150,000 from the estate fighting their wrongful claim.

    Two laws URGENTLY need changing. The Family Provisions Act MUST be rewritten as a matter of urgency to stop disgusting adult children stealing their sibling's or a spouse's rightful inheritance with morally wrongful court actions.

    More importantly, the laws concerning joint accounts needs to be changed IMMEDIATELY to stop dishonest children conning elderly parents into opening joint accounts that enable them to steal Mum or Dad's money and ensure what they take is not part of the estate.
    Lucky Lady
    13th Jan 2017
    3:12pm
    Many thanks to Fast Eddie for your response & to Slimmer Cat for your input - both very much appreciated! Yes I'll now Google NSW Trustee and Guardian (as I'm in Sydney) to find out more about them/fees/executor/valuer fees of home contents etc for Probate charges as mentioned. Thanks again & to all 'have a great weekend'!
    Lochie
    13th Jan 2017
    4:05pm
    Just letting people know there were fee changes introduced on 1st July, 2016 for the preparation of wills, powers of attorney & Enduring Guardianship documents by NSW Trustee & Guardian.

    The preparation of these documents are only free for those on a full Centrelink pension.

    Preparation of a will by NSW Trustee & Guardian costs $300 and if you are already a client an update is $200.
    Clients can nominate an executor of their choice or appoint NSWTG.

    Fees are available on their website.


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