Estate Planning

is an important and everlasting gift you can give your family. And setting up a smooth inheritance isn’t as hard as you might think.

What Is Estate Planning?

Believe it or not, you have an estate. In fact, nearly everyone does. Your estate consists of everything you own: your car, home, other real estate, checking and savings accounts, investments, life insurance, furniture, personal possessions. No matter how large or how modest, everyone has an estate and something in common—you cannot take it with you when you die.

When that happens (and it is if not when), you probably want to control how those things are given to the people or organizations you care most about. To ensure that your wishes are carried out, you need to provide instructions stating whom you want to receive something of yours, what you want them to receive, and when they are to receive it. You will, of course, want this to happen with the least amount paid in taxes, legal fees, and court costs.

That is estate planning—making a plan in advance, naming the people or organizations you want to receive the things you own after you die, and taking steps now to make carrying out your plan as easy as possible later. However, good estate planning is much more than that. It should also do the following :

Include instructions for your care and financial affairs if you become incapacitated before you die.

Include arrangements for disability income insurance to replace your income if you cannot work due to illness or injury, long-term care insurance to help pay for your care in case of an extended illness or injury, and life insurance to provide for your family at your death

Provide for the transfer of your business at your retirement, disability, incapacity, or death

Name a guardian for your minor children’s care and inheritance.

Provide for family members with special needs without disqualifying them from government benefits.

Provide for loved ones who might be irresponsible with money or who may need protection from creditors or in the event of divorce.

Minimize taxes, court costs, and unnecessary legal fees, which may include funding assets into a living trust, completing or updating beneficiary designations, or otherwise aligning your assets with your estate plan.

Importantly, estate planning is also an ongoing process, not a one-time event. You should review and update your plan as your family and financial circumstances (and the relevant laws) change over your lifetime.

Estate Planning Is for Everyone

It is not just for retirees, although people do tend to think about it more as they get older. Unfortunately, we cannot successfully predict how long we will live, and illness and accidents happen to people of all ages.

Estate planning is not just for the wealthy either, although people who have accumulated wealth may think more about how to preserve it. Good estate planning is often more impactful for families with modest assets because the loss of time and funds as a result of poor estate planning is more detrimental.

Too Many People Do Not Plan

People put off estate planning because they think they do not own enough, they are not old enough, it will be costly or confusing, they will have plenty of time to do it later, they do not know where to begin or who can help them, or they just do not want to think about it. Then when something happens to them, their families have to pick up the pieces

If You Do Not Have a Plan, Your State Has One For You But You Might Not Like It

At disability: If your name is on the title of your assets and you cannot conduct business due to mental or physical incapacity, only someone appointed by a court can sign for you. The court will supervise and ultimately control how your assets are used for your care through a conservatorship or guardianship (depending on the term used in your state). It can become expensive and time-consuming, it is of public record to some extent, and it can be difficult to end even if you recover.

At your death: If you die without a valid estate plan, any assets owned in your individual name and without a beneficiary designation or other governing contract will be distributed according to your state’s intestacy laws, typically through a court-supervised probate proceeding. In many states, if you are married and have children, your spouse and children will each receive a share, even if your children are from a prior marriage or no longer minors. That means your spouse could receive only a fraction of your estate, which may not be enough to live on. If you have minor children, the court will control their inheritance. If both parents die (e.g., in a car accident), the court will appoint a guardian without knowing whom you would have chosen.

Given the choice - and you do have the choice - wouldn't you prefer that these matters be handled privately by your family, not by the courts? Wouldn't you prefer to keep control of who receives what and when? And if you have young children, wouldn't you prefer to have a say in who will raise them if you cannot?
An Estate Plan Begins with a Will or Living Trust

A will provides your instructions, but it does not avoid probate. A will only directs how assets titled in your name and without a beneficiary designation or other governing contract will be distributed. The assets must still go through your state’s probate court before they can be distributed to your intended beneficiaries. (If you own property—usually real estate—in other states, multiple probates may be required, each one according to the laws in that state.) The process varies greatly from state to state, but it can become expensive with attorney’s fees, executor commissions, and court costs. It can also take anywhere from a few months to two years or longer. With some exceptions, probate proceedings are open to the public, and your creditors and any excluded heirs are notified of their opportunity to file for payment of a debt or a share of your estate. In short, the court system, not your family, controls the process and the timing of distributions to your beneficiaries.

For these reasons, a revocable living trust (combined with a pour-over will) is preferred by many families and estate planning professionals. Establishing and funding a revocable living trust can avoid probate at death (including multiple probates if you own property in other states), prevent court control of assets if you become incapacitated during life, bring all of your assets (even those with beneficiary designations) together into one plan, and provide increased privacy. Because the trust is revocable, the instructions governing it can be changed by you at any time. The accompanying pour-over will is a backup measure in the event that any assets are not funded into your trust during your lifetime and provides that those assets should be poured over into your trust upon your death.

Unlike a probate, which will end at some point, a trust can continue long after your death. Assets can stay in your trust, managed by the trustee you selected, until your beneficiaries reach the age you want them to inherit or longer to provide for a loved one with special needs; to protect the assets from beneficiaries’ creditors, spouses, and irresponsible spending; or to provide for future generations.

An estate plan that includes both a living trust and pour-over will is not necessarily more expensive initially than an estate plan that only includes a will, but it is more likely to avoid fees and costs later, considering that a funded trust can avoid court involvement at incapacity and death.

Planning Your Estate Will Help You Organize Your Records and Correct Titles and Beneficiary Designations

Would your family know where to find your financial records, titles, and insurance policies if something happened to you? Planning your estate now will help you locate and organize your information and documents, as well as find and correct errors.

Most people do not give much thought to the wording they put on titles and beneficiary designations. You may have good intentions, but an innocent error can create problems for your family at your incapacity or death. Beneficiary designations are often out-of-date or otherwise invalid. Naming the wrong beneficiary on your tax-deferred plan can lead to devastating tax consequences. Correcting titles and beneficiary designations now can save time, attorney’s fees, and taxes for your family later.

Estate Planning Does Not Have to Be Expensive

It is important to understand that trying to do your own estate planning to save money now can cost your family more later and may have consequences that you did not intend. An experienced estate planning attorney will be able to provide critical guidance and peace of mind that your documents are prepared properly to meet your objectives.

The Best Benefit Is Peace of Mind

Knowing you have a properly prepared plan in place—one that contains your instructions and will protect your family—will give you and your family peace of mind. Estate planning is one of the most thoughtful and considerate things you can do for your loved ones.

3 Generational Testamatory Trust Wills – Build with us

The Wills protect your family from losing their inheritance from tax, bankruptcy and divorce.

And to the tax man I leave...

Every year, Australian taxpayers voluntarily pay the
government millions of dollars in ‘death taxes’. The 4 defacto death duties are:

Are you going to be one of them? Proper Estate Planning ensures that your estate goes to those you care about. Not the Tax Man.

3-Generation Testamentary Trusts

The 3-Generation Testamentary Trusts’ additional advantages include:

32% Tax on Super going to adult children

After you and your spouse die your adult children pay 17% or 32% on your Super.  That is a non-dependancy tax. It is on your concessional superannuation. Our Super Testamentary Trust, which you get in these two Wills, seeks to reduce this tax to zero.

Divorcing children

The Divorce Protection Trust delays or stops any capital or income going to the beneficiary who is suffering from divorce or separation proceedings. It is designed to reduce the opportunity for the Family Court to get its hands on your money.

The Divorce Protection Trust sits dormant in the Will until needed. The Divorce Protection Trust activates for the benefit of the married person and that person’s children and grandchildren. It removes that person’s power to control the trust while they are suffering from the separation.

The Divorce Protection Trust benefits the current and succeeding generations. This helps protect the assets from the Family Court.

When You are building Testamentary Trust Wills with us. The trusts in your Wills include:

We provide you, personalized consultancy to our clients.