Back to Listing
Will I or won't I
17 July 2017
Using information from the NSW Trustee and Guardian, we look at the importance of having a Will.
Imagine a scenario such as this: a 21 year old with no Will is killed in a motor vehicle accident during the course of employment. There is a $200,000 insurance accident cover which forms part of the person's estate. The estate passes to the person's mother and father equally on intestacy, but the father had deserted the family weeks before the person was born. Although they had never met, the deceased's father received $100,000.
Whether you come from a small or large family, are a young adult or in your retirement years, have inherited a million dollar property, rent a humble apartment, have four kids or just a pet cat, a Will is something every adult 18 years or older should have in place. Yet according to research commissioned by NSW Trustee & Guardian, nearly half of all Australian adults (43 per cent)* do not have one in place, and while we may not think that it’s going to happen to us, the reality is that the unexpected can happen to anyone.
A Will is a legal document that clearly sets out your wishes for the distribution of your monetary and sentimental assets after your death. Without one in place, your assets including any real estate, cars, insurance payouts or items of sentimental value - such as your 80s record collection or grandmother’s wedding ring - will be distributed not as you would have chosen, but by a pre-determined formula. So if you die without a Will - this is called intestate - friends, family, partners and children may not inherit as you assumed they would.
Even worse, if your wishes haven’t been set out for family and friends, this could lead to disputes among loved ones that could see tens of thousands of dollars from your estate wasted on legal costs.
It is also imperative that your Will is kept up-to-date and reflects your current life circumstances, such as when you get married, divorced, move in with a partner, buy a business or property, inherit from an estate, have children or even grandchildren.
If you are a parent it is particularly important to make guardianship provisions in your Will for your children, so you can make your wishes known about who would take care of your kids if you weren’t around. This also allows you to set out how you wish your children to be brought up, including how they would be educated, where they would live, and how they would be supported financially.
Today, many of us also consider our pets to be part of the family, so you need to make sure your pet is taken care of. Some options you can specify in your Will to protect your pet include leaving a sum of money to an animal charity with a legacy program, organising a Testamentary Trust that allows you to appoint a trusted carer to provide physical care for your pet or you may also want to provide a gift of a sum of money in your Will to a friend or family member so they can look after your pet.
With extensive experience in estate administration NSW Trustee & Guardian has found some of the most common mistakes people make in regards to their Will are:
Not keeping your Will up to date. Births, deaths, marriages, separations and divorce all impact on your Will.
Not providing adequately for dependants may result in your Will being contested.
Not taking tax implications into account. Tax implications may alter the value of your assets when they are sold off.
Writing a ‘home-made’ Will may result in your Will being declared invalid if it was not signed or witnessed properly, or has ambiguous wording.
Overlooking superannuation: how you want this dealt with is important.
Not nominating guardian/s if you have children. If anything should happen to you, and your children are under the age of 18, it may be left to the courts to decide who looks after them.
While you can scribble your wishes on the back of an envelope or use a do-it-yourself Will kit, a Will is one of the most important documents you will draft in your life, so it is important to have it written by an expert. A professional Will-maker will ensure your Will is set out clearly, is legally valid and distributes your estate as you planned.
It’s also important to carefully consider, who you appoint as executor when making your Will. The executor carries out the directions contained in your Will. In some instances the work of an executor can be complex and time consuming, requiring knowledge of law, accounting and taxation requirements.
NSW Trustee & Guardian
NSW Trustee &Guardian is the largest Will-making body in NSW and, has 100 years of Will-making experience, drafting over 950,000 Wills. There is no charge to write your Will with NSW Trustee & Guardian when appointing them as executor , and you can update it as many times as you like as your life circumstances change. Charges apply on estate administration only. For those outside NSW, there are equivalent state trustee organisations in your state.
For more information: NSW residents can visit www.tag.nsw.gov.au or call 1300 364 103. For those outside of NSW, visitwww.publictrusteesaustralia.com to contact the Public Trustee in your state.
*Lonergan Research, Planning for Later Life Report - study conducted among 1016 Australians aged 18 years or older, September 2013.
First published Westpac Davidson Institute.