While 40 per cent of Australians do not have a Will, most of this group (54 per cent) are planning to make one.
Procrastination is the main reason for not having a current Will, yet the actual process of creating a Will is not as difficult or daunting as it sounds. Preparing a legal Will is the best way to ensure that when we pass away, our family and loved ones are looked after.
What is a Will?
A Will is a legal document that sets out how your property and possessions are to be divided after your death. Creating a valid Will places you in the best position to ensure that your assets are distributed in accordance with your wishes.
It is up to you to decide who will receive your assets; however, you do have a general obligation to provide adequately for your spouse or de facto partner, your children and any other dependents. If you fail to provide for them in your Will, they can bring a claim against your estate.
How do I create a valid Will?
The first step you should take is to consult with a lawyer with expertise in Wills and estates. A lawyer can assist you to ensure that your wishes are adequately expressed and that your Will is valid according to law.
You can choose an online or postal ‘will kit’; however, it may be difficult to know whether you have included all the necessary information and details in your Will. You also won’t receive the benefit of legal advice about the manner in which you have chosen to distribute your assets and any risks associated with your decisions.
The laws governing the legal requirements for preparing a valid legal Will in Australia vary from state to state; however, in all states, for a Will to be valid, there are some basic requirements:
- You must have testamentary capacity, which means that you must be over 18 years old and understand what you are doing.
- Your Will must be in writing (whether handwritten, typed or printed).
- Your Will must be signed, and two witnesses (over the age of 18) need to witness your signature.
- Those witnesses must also sign the Will.
The relevant information contained in your Will is likely to include:
- names and details of your chosen beneficiaries
- names and details of your executor/s and/or trustee/s
- details of the allocation and division of your property and possessions, and
- details of any guardianship clauses for children; this is particularly relevant to same sex couples, as the right to guardianship varies across Australia.
There's no need to file it with any particular organisation, but once you've signed off on it, make sure you keep it in a safe and accessible place.
The role of executor and trustee
When you make a Will, you will need to appoint an executor to look after your estate when you die. The executor must:
- collect all your assets
- pay all your debts, and
- distribute your estate in accordance with your Will.
An executor of a Will is like a liquidator who winds down the business you conducted throughout your life. A trustee (this can be the same person as the executor) is often appointed to administer any trusts set up in the Will; this scenario usually occurs when you leave assets to people under the age of 18.
When choosing an executor or trustee (and you may choose more than one), you should ensure that they are comfortable taking on the responsibility and performing the role. It is often wise to appoint someone younger than you, or to nominate reserve beneficiaries, in case the people you have appointed die before you do. You can also appoint a public trustee to do the job for you.
You should keep in mind that a Will is never a static document. You will probably tweak it throughout your life, particularly when your circumstances change significantly; for example, due to marriage, divorce or the death of a beneficiary. Above all, get the process moving – work out your priorities, chat with your loved ones and seek out the help of an experienced lawyer to guide you along the way.
Andrew Simpson is a Principal in Maurice Blackburn's Melbourne office.