Why do you need an Estate Plan?
The cost and inconvenience of establishing an Estate Plan is negligible compared to the costs, worry and distress to your loved one’s if inadequate provisions are made. Planning can ease some of the stress your loved one’s may experience at a very difficult and emotional time.
If you die without a Valid Will, you will die intestate, and your estate will be distributed in accordance with the Law.
Power of Attorney
An enduring power of attorney is a legal instrument by which you allow a person to make financial decisions on your behalf, such as paying bills and taking money out of your account, selling or purchasing property and signing legal documents. If you lose capacity to manage your own financial affairs and do not have an Enduring Power of Attorney, an application needs to be made to the South Australian Civil and Administrative Tribunal (SACAT) for a guardian or administrator to be appointed.
SACAT may appoint The Public Trustee to take over your financial affairs which will include fees for management.
Advanced Care Directive
An Advanced Care Directive makes health and lifestyle decisions for you if you lose the capacity to make those decisions for yourself. These include medical or dental treatment and where you live. You may appoint a person or persons to act as your Substitute Decision Maker. An Advanced Care Directive allows you to make Binding Medical Decisions should you lose the capacity to make those decisions yourself including being able to refuse medical treatment.
Probate and Administration
Probate applies where a person dies leaving a will and owning assets that need to be dealt with under the will. This includes property solely in the deceased person’s name and, sometimes, property owned jointly with others.
Administration applies where a person dies intestate without a will and leaving assets in South Australia. It follows basically the same procedure as for Probate, except that the deceased person’s next of kin makes the application. Where a person dies intestate, the estate is shared by their next-of-kin according to law. The applicant applies to the Supreme Court of SA for administration of the estate. An application for Administration usually takes longer than an application for Probate because of the extra documentation required to support an application.
FAQ's
You should think of a Will when you start employment. But the following may trigger a Will check-up:
- When there have been changes to your asset pool or the nature of your assets. Purchasing a house for example.
- When a guardian, beneficiary, or executor is now deceased.
- At significant changes to your financial situation
- When there are changes in your family structure (marriage, divorce, children, blended families, etc.). Marriage makes any Will you had before invalid. If you commence living with a new partner, having a Will update is something to consider.
- When you go through lifestyle changes, e.g. retirement
- If you enter into a business arrangement that may affect your financial situation
Super is one of the most complex assets. It depends on what type of Super you have and your personal circumstances as to whether it is distributed by the Super Fund or by your Estate. You should get advice regarding this.
A Will only operates when you die. An Enduring Power of Attorney that operates in the event of incapacity and an Advanced Cara Directive operate whilst you are alive but you are incapacitated.
While some joint assets do pass to a partner on death, this may not always be the case. We also can’t decide who dies first in a relationship. It is important that alternative beneficiaries are put forward. Having a Will always makes this easier and less complicated.
If you don’t have a Will and are in a de facto relationship, if your assets are not joint you are not usually automatically recognised as a spouse and may have to apply for a declaration to be recognised as domestic partners. The cost can be more than a Will, and your estate will be distributed in accordance with the laws of intestacy, not what you want.
A ‘grant of probate’ is a court’s official recognition that a Will is valid and the nominated executor(s) are responsible for dealing with the deceased person’s estate. Whether a grant of probate is required depends on the assets of the deceased.
A will kit can be legal if completed correctly. However, the requirements of a legal Will are complex. Making sure a Will covers all issues is complex. In the event that there are errors in your Will, the Supreme Court may give requisitions and require further documents be provided before granting Probate. Therefore, the cost of doing a Will with a qualified lawyer is more valuable and may save your family money and time.
The above examples relate to current laws in South Australia. They are general in nature, and you should seek personalised legal advice.