28/04/2014

One of the reasons people give for not sorting out their estate planning is that they don’t think they have enough assets to warrant an estate plan.  Most people are dead wrong about that.

Estate planning is not just for the wealthy. The advent of compulsory superannuation has meant that every worker in Australia now has a significant asset that sits outside the reach of their Will.  Their super benefits are held in a trust controlled by a third party trustee.  As such those benefits do not form part of a person’s estate and cannot be regulated by their Will.

So now the Will is not enough; they will also need a death benefit nomination provided to the trustee of their super fund.  With that additional requirement we have estate planning, not simply Will preparation but something more.

“But I haven’t got that much super”, you cry.  Many public offer super funds have life insurance for the member as an associated benefit so it’s not just the amount of the employer contributions that will be at stake but possibly also a substantial amount of life insurance if the member were to die early or unexpectedly.

And it doesn’t stop there.

With more and more people suffering from mental incapacity, either through age-related dementia or while suffering a condition that in an earlier time they would not have survived, the power of attorney has again become important.  Now we can create a power that continues to have effect despite the grantor’s mental incapacity – an enduring power of attorney.  So there’s another part of the estate plan that needs to be implemented for everyone – not just the wealthy.

In some States there is also the capacity for a person to designate who their guardian should be if they become unable to look after themselves.  In most States a separate appointment is necessary of someone to have the right to decide where that person will live and what sort of treatment they should have if they can’t decide for themselves.  Such a guardianship document is particularly necessary if they have no capable next-of-kin.  Another piece of the estate planning puzzle.

And while we’re talking about medical science, most people do not want their loved ones to go through the anguish and cost of keeping them alive artificially.  They want a document that makes clear their wish for such machine-dependent vegetative life to be brought to an end.  Another part of everyone’s estate planning.

These are the five documents that almost every adult in Australia needs – five documents that make up their estate planning.  Are any of these dependent on how much money the person has?  Clearly not.  Would only wealthy people want this level of protection?  Nonsense.

And we haven’t even begun to discuss the additional estate planning needs of the over 2 million people with a small business in Australia, many of whom will likely have a family trust and/or company to deal with which also sits outside the power of their Will.

Estate planning only for the wealthy?  No way – it’s for everyone.

To find out more regarding our Estate Planning Guide & Testamentary Manual  please call Peter Townsend on (02) 8296 6222, or click here to order the Estate Planning Guide & Testamentary Manual and begin the process of your estate planning. If you are not already registered with SUPERCentral, you will need to register first in order to gain access.

You will learn much about the issues to consider in arranging your estate planning and the resulting summary of your estate planning requirements will be invaluable regardless of what you decide about the preparation of your documents.