A good estate plan involves developing a strategy on how to best distribute your assets in the event of death or, quite often forgotten, the loss of physical or mental capacity.

To start putting a plan together, you need to consider the following:

  • Identifying your assets and who owns them, i.e.  in your personal name, jointly with someone else, in a legal entity such as a trust, company and superannuation fund;
  • Any Life Insurance policy you may have whether it be inside or outside super;
  • Your intended beneficiaries to receive your assets

A Will is the first document that is drawn up.  Assets covered by a Will include those owned in your personal name such as property, bank accounts, shares, and personal valuables. Superannuation does not form part of the Will unless a binding death benefit nomination (‘BDBN’) is in place nominating your legal personal representative, also known as the Executor.  Also, trust or company assets are not covered by Will, but the shares in the company or units in a unit trust are, if they are held in your name.

The Will can make provision for a testamentary trust. This trust effectively passes control of assets to a nominated trustee instead passing directly to a beneficiary, thus protecting those assets from unforeseen events, such as bankruptcy or failed marriage of the beneficiary. 

Enduring Powers of Attorney should also be prepared. These essentially nominate individual(s) who will make decisions on your behalf if you are unable to do so in the event of your absence, physical or mental illness or injury.

Superannuation can be dealt with through a BDBN whereby, the trustee is bound to distribute your super to your nominated dependants. 

A Letter of Wishes may be prepared supplementing your Will. This can detail how you wish your financial assets and personal belongings are to be met, how your funeral is to be carried out, and any personal messages to loved ones you wish to leave.

Digital assets are quite often forgotten about.  You should list your passwords, user identification numbers, etc.  and leave instructions on how your wishes are to be carried out.

A good estate plan is one that has been thoroughly thought through and ensuring you leave your assets to the intended beneficiaries.