Newcastle Living Magazine

Edition 11

Estate Planning – What You Need to Know

Did you know, the way you own your assets can have a significant impact on what happens to them when you pass away? Different approaches apply to assets held in joint names, individual names, companies, trusts and superannuation funds. This is one of the elements we consider when looking at your estate planning.

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So, what is an estate plan?

Put simply, it’s a way of ensuring your assets are passed on to your beneficiaries in the most appropriate way. But estate planning is much more than just preparing a will!

Estate planning looks at planning for what’s to happen with each element of your wealth after you pass away. The most obvious reason to do this is to protect your hard-earned assets and to do so in the most advantageous way for the beneficiaries of your estate. Not only this, we believe effective estate planning is as much about preserving relationships as it is about distributing assets.

Traditionally, your will was the major focus for estate planning. However, with progressive and ongoing changes to the way personal, investment and business wealth is owned and taxed these days, your will has become just one part of the process. Crucial estate planning decisions are now often made by your choice of financial products, such as superannuation and insurance, and in the ownership structures chosen for business and investment assets, the protection of assets and the minimisation of tax.

There are a wide variety of estate planning strategies which we use. What is appropriate for you comes down to your circumstance and your priorities. There is no “one size fits all” approach when it comes to estate planning. In some circumstances, simple wills are appropriate; more often than not, they aren’t.

Failing to give attention to, or to accurately implement, estate planning can lead to a reduction in the wealth passed on to your intended beneficiaries, causing unnecessary tax liabilities or the foregoing of pensions. It can even result in benefits passing to the wrong beneficiaries for example, estranged children or other relatives, former spouses or creditors, not to mention a higher chance of dispute between potential beneficiaries. At Osborn Law, we can assist you with all aspects of your estate planning.

Here are a few of the basics to know about each of the key areas:

  • Will – your will determines who receives your assets when you pass away and who controls this process. It only covers off on assets in your sole name.
  • Power of Attorney – this appoints one or more people to deal with your assets and financial affairs during your lifetime. They aren’t just for old people and can be very important in making sure you and your family are looked after if something happens to you.
  • Enduring Guardian – this appoints one or more people to make lifestyle and medical decisions on your behalf if you’re unable to do so.
  • Business Succession – planning for who takes over business operations and how an interest in your business may be sold is vital, particularly where you have business partners or where you have one or more children working in the family business.
  • Trusts – trust structures are becoming more and more common these days. Each trust has its own unique set of rules and estate planning looks at how we pass control of a trust over to someone else when you pass away. These structures can be fraught with danger where estate planning hasn’t been properly considered.
  • Testamentary Trusts – a common estate planning strategy which gives your beneficiaries options for long term tax and asset protection benefits. They can also help to protect assets where you have vulnerable beneficiaries or provide a way of balancing competing interests in blended families.
  • Superannuation – there are certain rules around who your super can and can’t pass to and the ways this can occur. These days, super is becoming one of the largest pools of wealth and it’s important to consider it properly. As a starting point, your will doesn’t cover what happens to your super.

We understand that estate planning can be a daunting concept and one that many put off until too late. Our accessible and complete approach to your estate planning ensures all estate and non-estate assets are considered, maximising the assets passed on to your beneficiaries. Most importantly, it provides peace of mind to you knowing your assets will go exactly where you want them to.

Contact Osborn Law

Osborn Law