Aug 14, 2018  | Tags: Back to Basics Series, estate planning

Our Insights

Estate planning may not be as enjoyable as booking a family holiday, but deciding who will inherit your assets after death is vital. A regularly reviewed and updated estate plan can provide you with the peace of mind of knowing that your estate will be distributed to your beneficiaries according to your wishes. 

What does your estate include?

An estate comprises of all of your investments, belongings and money. It includes everything you control or own such as accounts, furniture, collectibles, cars, artwork, and anything else that belongs to you.

Why think about estate planning?

Planning your estate has become more important than ever, and can often be more complex than just a straight-forward Will.

To ensure your beneficiaries receive the entitlements you intend them to receive, seeking advice from your financial adviser is a crucial step in developing a proper estate plan. Having a concrete arrangement in place can also assist in avoiding possible disagreements for your beneficiaries.

 Developing a proper estate plan will ensure that:

• The tax payable is minimised on the income and capital gains earned on assets
• The right ownership and control of your assets passes to your intended beneficiaries, and
• Your assets may be protected if the beneficiary is involved in any legal difficulties - for example, divorce or bankruptcy.

Things to consider

Who’s in charge?

Have you chosen someone to manage your affairs for you if you're unable to control your investments? You want to ensure that ownership or control passes to a beneficiary that you trust.

If you’re married, the first person you may choose to make decisions on your behalf is your spouse. If you’re not married, it’s good to not only go with someone who is trustworthy, but someone who is responsible and good with managing money. Other things to consider when leaving someone in charge is health, age and location – you want to ensure they don’t live too far away to effectively carry out their duties.

Who gets what?

Thinking carefully about who will inherit which assets and in what proportions is critical. Even if you’re happy for your belongings to go to your spouse and children, you still need to make a plan for it. This makes it easier for your family to sort things out after you’re gone.

 Another tip to reduce family conflict is to actually make your plan clear to your loved ones before your death.

Paying off debt

An area that often causes stress when creating your estate plan is your current debt. It’s important to consider whether you have accumulated adequate assets to provide for your family to pay off debts. If you’re worried you have not, your financial adviser becomes key in recommending options to make up the shortfall.

Keep it current

A regularly reviewed and updated estate plan helps ensure that when a significant change occurs, your plan is current.

 Things to remember to update:

• Commencing work
• Change of employment
• Getting married
• Getting divorced
• The birth of children
• Starting your retirement
• The death of a relative you have included in your estate plan.

Making sure an updated estate plan is in place can be a vital part of your overall financial plan. It’s something that can also eliminate stress and difficulties for your loved ones once you’re gone.  

Need a hand?

It is time to get your estate plan in order! Talk to Calder Wealth Management.

Call us on (08) 8373 3333 to schedule your free initial appointment.

Written by Ben Calder, Private Client Adviser at Calder Wealth Management.