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Estate Planning is all about bringing closure on
your Investments and Assets. Many people have worked
hard their entire lives to accumulate a solid asset
base only to neglect their Estate Planning and see
much of the wealth they had built up lost to nasty
legal |
disputes, or that the wealth is passed
onto people other than those that the
deceased actually cared about.
A well thought out and constructed Estate Plan
can see that your surviving Family and Beneficiaries
are looked after. Ward Financial Group have years of
experience helping people plan this important part
of their Financial Structure, and we can provide
assistance and information in relation to many of
the critical areas clients need to consider: |
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Estate Planning Issues
Wills & Enduring Power
of Attorney |
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The Will is the central component of
any Estate Plan. Yet many people either
do not have one, or their Will is over
10 years old and no longer relevant to
their current situation. In
circumstances where people have been
through previous marriages/relationships
and may have children from multiple
partners, then keeping this document
current to ensure that all parties are
appropriately provided for is a
necessity.
An Enduring Power of Attorney is a
document which gives the Attorney named
the power to act on your behalf during
your lifetime. This usually involves
taking care of your investments and
other financial matters. Importantly, an
Enduring Power of Attorney continues to
operate even if you become physically
and mentally impaired and are unable to
manage your own affairs. You must ensure
that you trust the person to whom you
are granting an Enduring Power of
Attorney, as they are able to act on
your behalf as if they were you. |
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While most benefits are usually
distributed to beneficiaries in the form
of a direct transfer of Assets, or a
Lump sum of Cash, there are other
options to consider. For some
beneficiaries, particularly younger
children or perhaps someone too
irresponsible to be trusted with a Lump
Sum, a better option may to establish a
Pension instead so that they receive
their entitlements in the form a steady
stream of income. Using pensions can be
particularly effective when distributing
the benefits of a Superannuation Fund.
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Testamentary Trusts are relatively
simple to establish through a Will. Once
established they can hold assets from
your estate and distribute income and
capital in a proportion to properly
reflect your beneficiaries' personal and
financial positions.
For example, income distributions could
be made to minor beneficiaries, taking
advantage of their ability to utilise
the adult tax-free threshold. The tax
savings can become all the more
significant where there are several
minor beneficiaries of a discretionary
testamentary trust.
In all cases with a testamentary trust,
the Will should provide for the
distribution of the assets at the
termination of the trust. |
Binding Death
Nominations |
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A Binding Death Nomination (BDN) is
similar in purpose to that of your Will,
in that it dictates where and how a
person would like their superannuation
entitlements to be distributed upon
their Death. Many people do not realise
that Superannuation Fund Trustees are
NOT bound by most Nominations made
regarding how a person would like their
superannuation to be distributed. In
most cases it is the Trustee who has
discretion, and they may only use the
Nominated Beneficiaries as a guide.
A Binding Death Nomination avoids all
this possible confusion as it does not
allow the Trustee to exercise
discretion. Instead, the Trustee must
follow the intentions of the BDN in the
same manner as an Executor does with a
Will. It is important to note that a BDN
is only valid for 3 years, so they must
be continually renewed if they are to
remain in effect. |
Note:
The actual writing of Wills, Powers of Attorney
and Binding Death Nominations, as well as the
formation of Testamentary Trusts must be
performed by a Lawyer. Ward Financial Group can
assist you in determining how you wish to use
these Estate Planning tools, as well the complex
issues you should consider with their
application. And if required we can then refer
you to an Estate Planning lawyer to formalise
the Legal documents required.
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