Why Everyone Needs To Know About Estate Planning.
Estate planning means putting in place a structure to organise your financial and personal affairs before any future incapacity and your death.
A complete Estate Plan enables your family, your business associates and others close to you to know your wishes and how you would like them carried out. Documents to consider when planning for the future include your:
– Will;
– Enduring Power of Attorney; and
– Advance Care Directive.
Wills
A Will is the document which sets out how your estate will be distributed upon your death. It deals with property that you personally own, but can direct control of other entities such as family trusts.
Issues to consider in your Will:
– Who will be the Executor? – that is, the person who administers your estate;
– Who are the family members or dependants that you should make provision for in your Will?;
– If your beneficiaries are minors or have a disability you can structure your Will to take these factors into account; and
– The tax consequences of distributing your estate.
The Will must comply with the procedures set out in the Wills Act 1936 (SA) including being witnessed by two independent witnesses who sign the document in your presence and in the presence of each other.
It is important that your Will is reviewed often and updated as your circumstances change. Marriage and divorce revoke a Will in South Australia.
Why should you have a professionally prepared Will?
If you pass away without a valid Will, and you have died leaving behind assets that need to be dealt with, it is usually necessary to apply to the Court to appoint an Administrator to distribute your estate in the order set out in Part 3A of Administration and Probate Act 1919 (SA). The Act divides your estate in set proportions depending on which family members survive you (‘statutory order’). The Act does not allow for your wishes to be considered in the distribution of the estate.
Enduring Powers of Attorney
An Enduring Power of Attorney (EPOA) is a document by which you appoint an Attorney to make decisions about your financial affairs on your behalf. The document can become effective as at the date you sign the document, or upon your legal incapacity.
An Attorney must act in your best interests and cannot use your finances to benefit him or herself. It is a power that you give only to a person you trust absolutely as it authorises third parties such as banks and the Land Titles Office to deal with your property on the instructions of the Attorney.
An EPOA is effective only during your lifetime and ceases to have effect on your death.
If you change your mind, you can revoke the EPOA and appoint a different Attorney.
Why should you have an EPOA?
If you become incapable of managing your own affairs, and you do not have an Attorney authorised to act for you, a person must be appointed by the South Australian Civil and Administrative Tribunal to administer your financial affairs. If there is no suitable person to act as an Administrator, an independent body such as the Public Trustee may be appointed to make those decisions for you.
Advance Care Directive
An Advance Care Directive (ACD) is a document by which you appoint one or more Substitute Decision-Makers to make health and welfare decisions for you during periods when you are unable to exercise reasonable judgment.
The types of functions that a Substitute Decision-Maker can perform include: deciding where you will live, what medical treatment you will receive and conducting legal proceedings on your behalf. Your appointed Substitute Decision-Makers must give consideration to the wishes, preferences and instructions for future health care, end of life, living arrangements and personal matters expressed by you in the ACD.
If you would like to discuss your Estate Planning needs or require further information about any of the above information, please contact Meroë Kuhl at Culshaw Miller Divorce & Family Lawyers on (08) 8464 0033 or make an appointment.
Blog post by Meroë Kuhl