No one really wants to contemplate death, so we often put off making a Will, placing it in the ‘I’ll do it one day’ box.
Approximately 45 per cent of Australians do not have an up-to-date Will. Young people, in particular, often underestimate the importance of having a Will and fail to plan ahead.
However, it is important to make sure that when that moment arrives, your assets and estate are divided in the manner you intended.
Why should I make a Will?
When you make a legal Will, you can decide how to divide your estate between any of family, friends and charities, and you can appoint your chosen executor to administer your estate. You can indicate your preference as to the guardian for your children. According to the study, getting organised, having children, cohabitation and changes in assets such as buying a house are the main triggers for making a Will.
There is often a perception that if you don't own much, you don't need a Will, but this is not necessarily the case. According to UQ's Associate Professor Tilse, Wills are “under-used by young people and viewed quite narrowly.
“Some people believe they are only for those with significant possessions.
“However, there are other extremely important functions of a will, including nominating guardians for any dependents, confirming funeral arrangements and appointing the executor of the Will.”
Dr Tilse has also noted that Wills could be complicated by blended families, culturally diverse families with traditions that vary from Australian law, and by the care expenses of increased longevity.
Creating a valid Will gives you choice and control over how your estate is distributed and simplifies the administration of your estate. You may want a certain family member to inherit specific items or you may want to allocate an inheritance to children from previous relationships, and you can also distribute items of sentimental or emotional importance.
Think of a Will as a gift you leave your family and loved ones, making the management of your estate easy and clear.
What happens if I die without a Will?
Even if you do not believe you have much property to leave to your beneficiaries, you should make a legal Will. If you die without a valid Will (known as dying intestate), a standard formula is used to distribute your property and possessions. This will usually mean that all of your assets will pass to your spouse or children, but the situation can become complicated if, for example:
- you die with no spouse or children
- you are separated and have a new partner (that is, you have a legal spouse as well as a new de facto partner), or you have children from different relationships, or
- you have a de facto spouse but have not registered the relationship.
Why take the gamble? Taking control of these decisions means you can secure your family's financial future.
Why is it important to get help with a Will?
Australian law societies generally advise against making your own Will, due to the fact that the law around Wills can be complex. Seeking proper, informed legal advice will assist you in expressing your intentions clearly and avoiding unnecessary tax liabilities for your beneficiaries, and will likely reduce the chance that the Will may be contested one day.
Take care of the admin
As your circumstances change, you will need to update your Will. It is important that you update the document in the following circumstances:
- when there are births, deaths, marriages and divorces in the family, particularly if any executors/s or beneficiaries die
- if you change your name, or anybody named in the Will changes their name
- when there is a purchase or sale of a significant asset, or
- if there is an inheritance or significant change to your financial circumstances.
Take the time to draft a Will so that your family and loved ones are protected and the executor can easily administer your estate. Where there is a Will, there is a much easier way.
Andrew Simpson is a Principal in Maurice Blackburn's Melbourne office.