Why "Young" people Should Have a Will
When asking younger people if they have a Will, I often hear the cliché response of “I don’t have anything to give” – wrong!
Younger Australians often underestimate their worth, not taking into consideration the extent of their assets.
Let me explain you why you need a Will.
If you work, you will probably have at least one superannuation policy. Many people are unaware that there is an associated death benefit component attached to their superannuation policy, which is payable upon their death. This death benefit is often worth hundreds of thousands of dollars.
It is therefore very important to seek advice about making a binding death benefit nomination, in which you nominate a beneficiary to receive your death benefits.
Typically, superannuation doesn’t form part of your estate. However, this is not always the case. Some superannuation funds will only pay your superannuation proceeds and death benefits to your estate. Having provisions made in your Will, dealing with your superannuation proceeds and death benefits upon your death, will ensure that the funds will reach your intended recipient.
You’re buying a house
Many people may not realise that you can own property in different ways:
- Sole tenant: you own the property solely;
- Joint tenancy: you purchase the property with another individual and upon your death, your share in the property will automatically pass to the surviving tenant; or
- Tenants in common: you purchase the property with one or more other individuals in specified shares and upon your death, your share in the property will pass to your estate to be dealt will under your Will.
If you own your property solely or as tenants in common, it is important to formalise in your Will what your wishes are regarding what is to happen to your property upon your death. If you die without a Will, your property or the proceeds from its sale could end up being divided amongst people whom you did not intend to benefit from your estate.
Are you married or in a de facto relationship?
Many people believe that when they die, their spouse or de facto partner will, by default, inherit everything they own. This is not the case. If you die without a Will, you are said to have died “intestate”, which means that the Administration Act 1903 will determine how your assets are divided and to whom they are to be distributed. Again, everything you have worked hard for in life may end up in the hands of an unwanted recipient.
If you have recently married and had made a Will before marrying, that Will is now potentially INVALID! Many people are unaware that marriage revokes a prior Will (unless it’s made in contemplation of marriage). After marriage it is important to review your Will and make a new one so that it includes your new spouse. It’s vital that both parties have a clear understanding of how their assets will be distributed after they die, and the best place to record those intentions is in new Wills.
You’ve had a baby
Now is the time to update your Will, making provision for your child, as well as your spouse, if you die. You and your spouse will also need to consider what would happen to your child in the event of you both dying at the same time. This can be handled by appointing a guardian for your child, who will then have the responsibility for making decisions for your child until they reach adulthood. Of course this appointment requires a lot of thought and agreement between you and your spouse.
You want to give someone a gift
If you own a particular item which has sentimental value and you would like to give it to someone upon your death, you can specify this in your Will. You can then rest assured that your wishes are recorded in a legally binding document.
Your Will is automatically revoked when you divorce, unless it was made in contemplation of your divorce. If you are in the process of getting a divorce, make sure your affairs are in order, starting with a new Will.
One of the most important times to update your Will, or make a new one if you do NOT have one, is if you have separated from your spouse or partner. Although a marriage breakdown is a stressful time in a person’s life, this stress can be greatly reduced just by knowing that your affairs are in order.
Before the Family Court will grant a divorce, parties must have been separated for at least 12 months.
If your current Will states that your spouse is to inherit your estate upon your death and you die while in the midst of a separation and while still legally married, under your Will, your spouse will still be entitled to your estate. Similarly, if you die without a Will while still legally married, under intestacy laws, your spouse is a person who is entitled to inherit from your estate.
With the above scenarios fresh in your mind, it is an opportune time to consider your Will. Be prepared and minimise the risk. There is no excuse for not having a Will. Life is unpredictable and having a plan in place will make life a lot easier for the loved ones you leave behind.
Our professional Team at Butlers has extensive experience in preparing and updating Wills at all stages of life, catering for all levels, from simple to complex. Please contact us to ensure that your Will is designed to do exactly what you want it to do, providing peace of mind for you and security for those you love.