“My partner and I have recently had our first child. I've been thinking more about the future and how I can secure my family's financial well-being. How can I ensure that my estate plan is up-to-date and accurately reflects my current wishes and circumstances?"
-Question from Olivia in Glenelg, South Australia
Top answer provided by:
Andrew White
Hi Olivia and thanks for the question.
Firstly, congratulations on the birth of your first child. It's an incredibly exciting time (I have 2 young boys of my own) and many life adjustments are required (surviving on limited sleep being a major one!).
Having a family does tend to turn your mind to the future and ensuring your children are looked after if anything were to happen to you and your partner. To be honest, the only way to ensure that your estate plan is up to date is ensuring the relevant documents are prepared (I’ll go into more detail shortly), then reviewing your plan periodically. I would suggest yearly at a minimum.
In terms of how to organise your estate plan, there are several important documents that should be prepared and reviewed. The key ones are:
A Will. Your will dictates how your assets will be split to your beneficiaries after you die. Depending on your situation, this can be simple or complex. When children are involved, many people choose to leave all assets to their surviving partner, or if there is no surviving partner, then a Trust structure may be suitable to look after the children until they are old enough to receive and manage funds on their own.
Powers of Attorney. These documents appoint a person or people to make legal and financial decisions on your behalf if needed. This could be if you are incapacitated or unable to be present to make a decision (as an example if you were overseas).
Guardianship. This is the person or people that would look after your child if you were to pass away. Given your situation with a young child, this is a very important decision to make. Things to consider when appointing a guardian for your child are values and religion, education, health, lifestyle and living arrangements.
Other areas: Superannuation beneficiary nominations, Life insurance beneficiary nominations. These are forms that direct payments to nominated beneficiaries instead of the money being paid into your estate and forming part of the will. The benefits of having these nominations in place is generally speed of payment and the funds going to your listed beneficiary directly. The superannuation fund or life insurance company will be able to process a payment faster than going through the probate process.
Some of these forms can be prepared by you or sourced at a low cost – there are online services or templates available for setting up your wills, Power of Attorney and Guardianship. Your superannuation or life insurance company can provide their beneficiary nomination forms. When there is added complexity, working with a Wills and Estates Lawyer can streamline the process and ensure you are getting the best possible outcome.
Whilst it can take some time and focus to get these documents in order, once they are done – then it’s a matter of reviewing them to make sure your circumstances or wishes haven’t changed significantly.
Olivia, I hope I’ve helped identify the key documents for you to focus on – and I’m sure once they are prepared and in place you’ll gain peace of mind knowing your family will be well protected.
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