Worried about your Hard-earned Assets?
In simple terms, the term ‘estate’ refers to your net worth in the eyes of Australian law. Estate planning lawyers will explain that a comprehensive estate plan will include much more than the Will. It’s important to understand that the word ‘estate’ includes much more than real estate. Estate not only includes property but also includes bank accounts, vehicles, homes, boats and jewellery and so on.
A legally valid estate plan will include advanced directives such as trusts for children and grandchildren, for pets or charity organisations as well as power of attorney (POA). By choosing to plan your estate while you are sound of body and mind, you are in a position to eliminate any uncertainties over the administration of your estate after your death. Specifying the POA helps another individual take care of decision-making if you are unable to do so due to health reasons etc.
Estate planning helps establish complete control over the distribution and disposal of your hard-won assets and properties. Estate not only describes what an individual owns but also what he or she owes. The beneficiaries will only inherit what remains after debtors have been paid in full. It’s important for an estate plan to take into account all the important factors. Estate planning is typically done along with the assistance of a lawyer and a financial advisor.
A comprehensive estate plan will usually contain the following important information:
- A will: Your will contains current beneficiaries, your wishes and your assets. A will and last testament is legally binding in the eyes of law. In case, you remarry or get divorced etc, you may need to change your will.
- A healthcare power of attorney and financial power of attorney: In case you become invalid or insolvent etc, your estate plan will specify the names of the individuals who are authorised by you to act on your behalf. The healthcare proxy (the individual mentioned in the POA) will make medical decisions while the financial POA will handle financial decisions.
- Instructions with regard to your funeral: People may prefer their funerals to be conducted in a certain manner according to religious or personal reasons. These should be mentioned in the estate plan. Funeral costs will be deducted from your estate.
- Name of an impartial and reliable executor who will be responsible for executing the provisions of your will.
Preparing an estate plan is an excellent opportunity to review all your assets including bank accounts, insurance policies, debts, loans owed and retirement accounts etc. A well-structured estate plan will help you protect loved ones, distribute your assets the way you want and minimise the chances of disagreement and conflict within the family.