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Estate Planning is all about control and flexibility. If you lose capacity, suffer a medical event or die, you want the transfer or control of your assets to pass to the right person at the right time and in the most tax effective manner.

This is especially important for your Will because:

  • You don’t know when you're going to die

  • You don't know what the tax laws will be

  • You don't know what assets you will own at that time

The best Estate Planning outcome should be achieved as simply as possible with a minimum cost - while maintaining the greatest control and flexibility over your assets. But, as important this is, only around half the families in Australia have a valid Will. Here are 4 keys areas to address so that you have a strong Estate Planning structure in place for your family.

Control what's most important for your family.

1. 3-Generation Testamentary Trust Will

Developed by a leading Australian law firm in the 1990’s specialising in estate and tax planning and works for the next 3 generations. It's the most flexible I've seen and gives the greatest control over your estate. Here's why:

  • They last for up to 80 years.

  • Your children can pass down the 3-Generation Testamentary Trust to their children.

  • Reduces CGT, income tax and stamp duty for up to 80 years from date of death. 

  • Includes Superannuation Testamentary Trust to stop the 17% or 32% tax on super going to adult children.

  • Includes Bankruptcy Trust if a beneficiary is bankrupt.

  • Includes Divorce Protection Trust – if a child separates stops Family Court taking your money or generational family assets.Includes a

  • Includes a Maintenance Trust – if the beneficiary is under 18 or vulnerable (disability, addiction, spendthrift etc)

 


2. Enduring Power of Attorney - Financial Matters

If you become disabled or not have the capacity to make decisions, this document will provide your nominated attorney (usually your spouse, a close relative or friend) with the power to act on your behalf to manage your financial and legal affairs. Your attorney will have the power to do anything that you can do (e.g. operate your bank account, pay bills, sell and purchase assets) except make a Will. 

 

It's important to appoint an Enduring Power of Attorney to ensure that your nominated attorney retains the power to act on your behalf even if you suffer a loss of capacity through unsoundness of mind.  

 


3. Enduring Power of Attorney - Medical Matters

Many people focus on planning ahead for their financial and business affairs by making a Will and a Enduring Power of Attorney for Financial Matters but don't consider what will happen if they find themselves unable to make lifestyle and medical decisions due to illness or accident.

A Medical Power of Attorney is someone you appoint to make lifestyle, health and medical decisions for you when you are not capable of doing this for yourself. Your Medical Power of Attorney may make decisions such as where you live, what services are provided to you at home and what medical treatment you receive.

 

Your Attorney’s power will only come into effect if or when you lose capacity and will only be effective during the period of incapacity, therefore, it may never become operational. However, it is a good way to plan for the future, particularly for unforeseen situations. 

 


4. Superannuation Death Benefit Nomination

The assets within your superannuation fund do not automatically form part of your Will. Most people don't know this and it catches them out. Don't be one of them.

You want to direct your super benefits to your 3-Generation Testamentary Trust Will. To do this, all you have to nominate the Legal Personal Representative of your estate as the sole beneficiary.

 

In general, where you have made a non-binding death benefit nomination, your superannuation fund beneficiary nominations are only used as a guide - “the trustees” of your fund will have the ultimate discretion to decide who will receive your superannuation benefits. They will take into consideration the beneficiary nominations that you have made but are not bound by your request. This option gives you the least control and flexibility.

The only exception is where your superannuation fund allows you to make a binding death benefit nomination. A binding death benefit nomination requires the trustee to pay out your superannuation benefits to the nominated beneficiary - a dependant or dependants of your choice or to the person who is your Legal Personal Representative. This is the one you want.

Let's talk

I work with one of Australia's most qualified Estate Planning specialists. And I use them myself. Together we'll help you get this strong Estate Planning structure sorted for your family - something you can truly rely on for maximum control and flexibility. Contact me if you've got any questions.