It is vital that everyone has a valid and up-to-date will. This is the only way to ensure that your property is distributed in accordance with your wishes. Your will should be professionally prepared to avoid errors. Any mistakes will have to be rectified by your executors at potentially great cost to your estate.
Responsible family members, friends or professional advisers whom you can trust should be appointed as executors and trustees. It is these people who will have the responsibility to transfer your assets to the people you wish to provide for.
Your lawyer will assist you with practical and legal considerations. If you do not have a legal will, your property and possessions will be disposed of in accordance with State legislation (see intestacy).
What is a will?
The will is the document that transfers those assets that you own in your individual name to your nominated beneficiaries.
The will does not deal with all of your assets.
The following assets may or may not be covered by a will and should be dealt with separately to ensure that ownership/control passes in the way you intend:
Subject to the terms of the trust deed of the superannuation fund(s) of which you are a member, the trustee has a general discretion as to who is to receive the superannuation money in the event of your death. Generally the trustee will follow the nomination that you have made. It however does not have to do so, except in certain circumstances. Therefore, it is important that your death benefit nomination is up to date and reflects your wishes.
Is paid directly to the owner of your policy. Life insurance can, therefore, be an estate asset. You should check who is the owner of your policy to ensure that it correctly reflects your wishes.
Assets owned by a family trust
These assets remain inside the trust. The trust deed will indicate who will assume control of the trust in the event of the controller’s death. If you control a trust, the deed should be reviewed to ensure that control will pass in the way that is intended in the event of your death.
Assets owned by a company
These assets will continue to be owned by the company in the event of the death of its controllers. The constitution of the company should ensure that control of the company passes to the people who you wish to take control in the event of your death.
Most people wrongly believe that their will covers all of their assets. This is not the case. Many problems can arise because of this wrong assumption. Care should be taken to ensure that ownership and/or control of all of your assets pass in the way that you intend.
Why review your will?
Certain events affect the validity of your will. If you have married or divorced since you last executed a will, you will need to execute a new will. Similarly, if you have a child that is not contemplated by your current will and you do not alter it to include the child, that child may need to apply to the Court to have the will varied in their favour.