Estate Planning Tips

Law Blog

Estate planning is the task of deciding how your businesses will run and who will inherit your wealth once you die. Below is a guide on how to create an effective estate plan.

Know What To Include

Other than your assets, consider intangible assets and your debts. You may opt to sell some of your assets to clear personal and business debts. This ensures your beneficiaries do not inherit your liabilities. A vital aspect of the estate planning process is superannuation fund and life insurance benefits. You will have to nominate beneficiaries to inherit the proceeds. Otherwise, the trustee or insurance company will submit the amount to your spouse or immediate children. 

Remember to include digital assets such as cryptocurrency in your estate plan. Most companies will not transfer assets to someone else once you die. As such, you could opt to leave your beneficiaries with login details to the website to ensure they can access the assets.

Wills

Below are tips to help you create a will.

1. Ask a wills and estate lawyer to help you draft the will. He or she will ensure that the document is legally binding.
2. Preferably, include all your beneficiaries in the will. If you opt to leave someone out of the will, give a justification. This will prevent people from contesting the will.
3. The will must be updated to suit changing circumstances. For instance, you may want to add a new beneficiary or remove a divorced spouse from the will.
4. Include contingent beneficiaries. These are people who will receive the inheritance if a beneficiary cannot bequeath the estate.  

Trusts

Trusts will help you safeguard the inheritance of children below 18 years or irresponsible beneficiaries. Family, unit and hybrid trusts are ideal if the trust will have more than one beneficiary. These trusts allow the testator to divide the trust into shares. It is unlike a bare trust where the beneficiary has complete control over the trust. As such, if the trust has more than one beneficiary, they may disagree about when and how they should receive payments. 

Living Wills and Powers of Attorney

A living will is a medical directive on the kind of care you would want to receive when incapacitated. For instance, you could ask your family members to plug you out of life support after a week. A power of attorney allows an individual to make medical and financial decisions when you are incapacitated.

Estate planning is a vital process that ensures your wealth is left in the right hands. Working with an experienced wills and estates lawyer will significantly ease the estate planning process. 

To learn more, contact wills and estates lawyers in your area.

26 February 2020