Thinking about what is going to happen to your assets and finances after you’ve gone is never something that you want to do. Many people assume (which is always dangerous) that if they are married and have children, then everything will automatically go to their spouse and/or children, but this is not the case.
People often see getting a will drawn up officially as an unnecessary or even unjustified expense, given they can cost hundreds of dollars per person. However, the true cost of not having an up to date will is actually far more detrimental to your finances than the upfront cost of drawing up a will and keeping it up to date over the years.
Having a will drawn up is great, but you also need to make sure that as your personal circumstances change over time, so your will does too. Getting married, divorced, or having children, are all major life events that will have an impact on your legal will and testament. There are several reasons why everyone needs an up to date will.
Protect Your Family Financially
The main reason most people get a will is to ensure that your financial assets are distributed according to your wishes and that your loved ones receive the financial assistance that you have specified. This includes all assets you own such as cash in the bank, investments and shares, property, any businesses, your superannuation and family heirlooms or valuable items.
Guardianship of Children
Another crucial reason to have an up to date will is to ensure that your children have legally nominated guardians in the event that you should pass away before they turn 18. If you die without a will in place in Australia, your children are taken into the care of the state until such time as the state can determine who they should live with. This happens even if there are grandparents, aunts or uncles that are able to look after them – so don’t assume that just because you have lots of family that your children will automatically be looked after in the event of your death. Read this helpful article about how to choose guardians for children.
Nominate Beneficiaries Of Particular Assets
If you have clear ideas of who you would like to inherit particular items, having an up to date will means that the right people will inherit the items you specify. As your personal circumstances change, these conditions may change as well so by reviewing your will regularly and at major life events, you can be certain that your wishes will be carried out.
Exclude Certain People From Inheriting
We don’t like to think about excluding people from our lives and inheritance but unless we document any wishes around exclusions then there is always the risk that individuals will benefit from your estate even if you don’t want them to. By specifying that you don’t want certain people to inherit particular assets, heirlooms or anything else, you can be assured that your wishes will be followed. (Note that there are certain individuals who are able to challenge a will where they have been excluded but these are limited to specific relations – speak to your estate planning lawyer about this if you have any concerns.)
Make Sure It Is Up To Date
Once you have had your will drawn up officially, it is a good idea that you review it annually or whenever a major life event occurs – for example when you have a child, if you get married or divorced or if you move states or countries. Because different states and countries may have different laws, it’s a good idea to speak to a local estate planning lawyer to check if your will is still valid or legally recognised.
Having a valid will in place is a key part of creating a secure financial future for your family. If you’d like our financial planner in Joondalup to review your finances and long term financial goals, call us on 08 9300 2553 or contact us via our website today.
Please note this does not constitute legal advice – read our disclaimer here.