Modern family estate planning

Modern Family Estate Planning for The Brady Bunch

Don’t Think You Need Will?

Don’t Think You Need Will?

Busting the Four Most Common Myths

In all my years dealing with clients and urging them to make a Will, I have heard every excuse for not making one. But of all the unfounded excuses, these four are probably the biggest myths I have come across.

“I Don’t Need a Will Because my Wife / Husband Will Get the Lot Anyway”

This is simply not true. Who will get what is determined by a strict formula set out in the Queensland Succession Act, and your partner does not automatically “get the lot”.

“I Don’t Need a Will Because My Children Get Along Well”

There is an old saying, “say you know not a man until you have shared an estate with him”. Ugly scenes often come about from the influence of those outside the family. There are far too many people giving incorrect and poor guidance based on “folklore” and not what is actually the law. I have seen families torn apart fighting over the estate of a parent. Do not bring this upon your family. Make a Will so your wishes are clearly set out.

“It Costs Too Much”

Trust me when I say the cost of preparing a Will is nothing compared to the costs, both financially and emotionally, that your family will have to pay if you die intestate (ie. without having made a Will).

“I am Not Old Enough to Have a Will”

Unfortunately age does not protect you from accidents and tragedies. The rule is simple, everybody over the age of 18 should have a Will.

Hopefully this article has laid to rest those myths and cleared up any doubts and uncertainties you may have. If you love and care for your family then you owe it to them to ensure that they are protected.

The easiest way to address these matters is to speak to us at McLaughlin and Associates Lawyers. We will tailor a Will to suit your specific needs.

By John McLaughlin

Principal, McLaughlin & Associates Lawyers.

Where There’s a Will…

Two Important Things Your Will Does Not Cover

It is understandable that most people would think that making a will, especially with a do-it-yourself “Will Kit”, would be comprehensive and everything would be covered off.

Unfortunately, that is not the reality and most people do not understand what they can and cannot control in their Will. That is because certain assets do not form part of your estate. We see this problem all the time, most often, when people have bought a “Will Kit” online or from their local news agency.

 

1. Superannuation is not automatically part of your Estate

There are specific rules and requirements associated with Superannuation.  Most people I speak to are surprised to learn that, upon death, the Trustee of their Super Fund generally decides who receives their superannuation entitlements.   The restriction of Trustee’s ability to make this decision for you should form part of your overall Estate plan.

2. Your Will Does Not Cover Your Family Trust

This also include assets held within the trust. Those assets sit outside of your estate. To establish a succession or inheritance plan for your family trust, speak to us to address this issue.

These matters are not automatically covered in a Will, but there is an easy way to address them and ensure that your intentions are covered and that is to speak to us at McLaughlin and Associates Lawyers.

We will tailor a Will to suit your specific needs and address those assets that stand outside of your estate.

By John McLaughlin

Principal of McLaughlin & Associates Lawyers

A Warning About Wills

A warning about wills

Many people have had their Will prepared by the Public Trust Office or a similar organisation at little or no cost, but there is a catch! As the old saying goes “there’s no such thing as a free lunch”.

Many organisations will offer you a “free Will” but will require that they are appointed your Executor and Trustee, and there is the catch!

These organisations impose prescribed fees to administer your estate based on a percentage of the total gross value of your estate which can mean the costs associated with handling your estate can be exorbitant in comparison with the fees charged by a Solicitor because their costs are based on the value of your estate not on the work it actually takes to administer your estate.

If you have made a Will with such an organisation you should think again. A few extra dollars spent now in having your Will professionally prepared by a Solicitor may save your estate thousands of dollars after you are gone.

A lot of people also try to save a few dollars by buying a Will kit but again be warned. These sorts or kits are generic as they have to be to be mass produced. If you make a mistake in completing them, signing them or having them witnessed your Will may be invalid. Whereas a Solicitor will take the time to speak to you individually and ensure that your Will properly reflects your wishes.

Who Is Entitled to Read the Will of a Deceased Person

Who is entitled to read the will of a deceased person

This is something we encounter quite a lot from people who believe, for whatever reason, that they are entitled to read or obtain a copy of a Deceased person’s Will.

But who is actually entitled to do so?  The answer lies in Section 33Z of the Succession Act.  Section 33Z (1) (a) says that only an entitled person can inspect a deceased persons Will.

So who is an entitled person? Again we need to go to Section 33Z(4) of the Act which states that an entitled person is either of the following:

(a)   a person mentioned in the Will, or mentioned in any earlier Will as a beneficiary; or

(b)   is a spouse, parent, or child of the Testator; or is a person who would be entitled to a share of the Estate if the deceased had died intestate; or

(c)   a parent or guardian of a child mentioned in the Will or who would be entitled to a share of  the Estate if the Testator had died intestate; or

(d)   a creditor or other person who has a claim against the Estate.

So if you are named as an Executor of a Will and someone demands to read or obtain a copy of the Will, first make sure they are entitled to do so.

Should you wish to discuss any matters regarding the matters raised in this article please contact Mr John McLaughlin of McLaughlin & Associates on 3808 7777.

enduring power of attorney

Enduring Power of Attorney

enduring power of attorney

Enduring Power of Attorney

When people think of estate planning they usually think of the need for superannuation, life insurance and income protection but equally important is the need for a Will and an Enduring Power of Attorney. I have spoken at length over the last month about the need for a Will now I wish to turn to the equally important aspect of having an Enduring Power of Attorney.

What is an Enduring Power of Attorney?

It is a document given by one person (the Donor) to another person (the Attorney) which enables the Attorney to act on behalf of the Donor and to do all things which the Donor could himself do. The Attorney in effect steps into the shoes of the Donor and can sign documents, access bank accounts etc.

Why do I need one?

Everybody should have an Enduring Power of Attorney appointing either their spouse, relative or close friend to act on their behalf in the event that they are either absent or mentally incapable of handling their affairs eg. if you are out of town and need documents signed or access to monies or something to be done on your behalf which only an authorised person can do for you.

But the real benefit of an Enduring Power of Attorney is that the power to act on your behalf continues after you become mentally or physically incapable of doing things on your own behalf. For example, we have had cases where the husband and wife may, for tax purposes, have an investment property, shares or money invested in one persons name only. That person has suffered a stroke, heart attack or been in a motor car accident such that they are either physically or mentally incapable of handling their own affairs. The spouse may need to sell some of the assets or access some of the money in order to provide ongoing medical care for the injured party but because they don’t have an Enduring Power of Attorney that cannot easily be done. Instead, a Government appointed Trustee is nominated and as you can imagine, the process becomes very expensive and bogged down with red tape. That could all have been avoided by the making of an Enduring Power of Attorney.

Who should have one?

The simple answer is: Everybody! Spouses should each have one appointing the other their Attorney, the same applies for people in defacto relationships. But also think of the need for the elderly to appoint a child or children Attorney for them and also single children appointing a parent or parents as their Attorney.

It is especially important for adult children to think about their parents as they get older. By having an Enduring Power of Attorney a son or daughter can help their parents as they get on in life with accessing bank accounts, handling documents etc and in the event of mum or dad suffering a stroke or heart attack being able to handle their affairs.

For example, we had a case where an elderly woman suffered a stroke and was physically and mentally incapable of handling her affairs. The family home was in her name only and the children had to place her in a nursing home. The problem was that the home had to be maintained, the rates and insurance paid as well as meeting the costs of nursing care. There was no Enduring Power of Attorney. If there had been, the children could have sold the family home, placed the proceeds on trust for mum and met her ongoing care from the sale proceeds.

So think about it, if you have parents (it doesn’t matter how old they are now) seriously consider the benefit to them and you of having an Enduring Power of Attorney so that one day you will not face the same problems as the family mentioned above.

 

Video 

Prefer the video format? Our principal, John McLaughlin, provides an informative Law Talk episode about the Enduring Powers of Attorney

Importance of having a will

The Importance of Having a Will

importance of having a will

It never ceases to amaze me the number of people who don’t have a Will or if they do have one it is grossly outdated and does not reflect their current circumstances.

The bottom line is that everybody from the age of eighteen (18) should have a Will and that Will should be reviewed regularly to ensure that it keeps up with your changing circumstances.

But first, lets go back to basics. What is a Will? A Will is a legal document that enables a specified person or persons (your Executors) to distribute your assets according to your wishes when you die. Your assets include your house, land, car, bank accounts, insurance/superannuation policies and any other goods that you may own at the time of your death.

Your Will sets out which asset goes to which “beneficiary”. Beneficiaries can be family members, friends, charities or other organisations. If you have a young family, your Will can also state who is to be the legal guardian of your children in the event that they are left without a parent.

For the time being, keep this in mind, if you don’t have a Will then you don’t have a say in how your assets will be distributed or who will administer your estate for you. That will be done by the Government adhering to a rigid formula.

If you don’t have a Will or you need to review your existing one, please don’t hesitate to contact us.

why have a power of attorney

Why Have a Power of Attorney?

enduring power of attorney

We have found that many people believe that a spouse (whether married or de facto) is able make decisions on behalf of their partner, as a matter of right, due to their relationship.

This is simply not the case.

The decision making process is solely within the purview of each individual person and is generally only able to be transferred to another when a person enters into a Power of Attorney document.

When a person (known as the Principal) enters into a Power Attorney document they are, in effect, transferring their power to another person (known as the Attorney).

It is the transfer of this personal power which permits an Attorney to make decisions for and/or act in the place of the Principal. The types of decisions that an Attorney can make are broad ranging, from financial matters, such as selling a house, taking care of the finances to personal/heath matters such as deciding about where a person will live. A Principal can also limit an Attorney’s power, should they wish to do so, or expand upon it to allow the Attorney to enter into conflict transactions. This is particularly relevant where an Husband/Wife has been appointed as an Attorney.

Where an Attorney has also been appointed to make decisions regarding Personal/Heath matters, this power only commences when the Principal has lost his or her mental capacity.

Having a valid power of attorney is beneficial for a number of reasons, such as:-

  • older people are able to appoint the person they want to take care of things
    for them should s/he not be able to do so in the future;
  • going overseas for an extended time, and want a person in Australia to take
    care of things;
  • where a person suffers poor heath and wants to ensure that their affairs
    are in order should they lose capacity.

Powers of Attorney documents are also beneficial should you have an accident and lose your mental capacity.  In this instance, should you not have a Power of Attorney, a relative would need to apply to the Tribunal to be appointed as your Guardian and Administrator.  This can be a lengthy process and it may be that necessary a government body would have to look after you/your affairs until any other appointment has been made.

There are two types of Power of Attorney Documents, being:-

  • A General Power of Attorney – this type of document is generally only used when a Principal wants their Attorney to operate on their behalf for specific transaction.  These types of transactions are generally involve commercial transactions and do not permit the attorney to make decision for the health care of the principal.
  • An Enduring Power of Attorney – this type of document is generally used when a Principal wants to ensure that the Attorney can act on their behalf for a full range of financial matters, and also assist the Principal should he or she need assistance in Personal/Health Matters upon the loss of mental capacity. However the primary difference between these two types of documents is that the power provided under a General Power of Attorney will end on when the Principal losing his or her mental capacity whereas the Enduring Power of Attorney will continue to remain in full force and effect.

When appointing an Attorney, the Principal should appointment a person whom they trust will act in their best interests.  There are also other requirements, such as your attorney not being your paid carer or health care provider.

Problems can occur if the Power of Attorney document has not been completed correctly or it not been witnessed correctly.

A witness’s duty extends further than merely witnessing the Principal’s signature. The witness must also judge whether or not the Principal understands the nature and effect of the Power they are providing.

If not, then the power of attorney can be challenged by any interest party.

Therefore, it is important that if you are considering providing this Power to another person, that you be properly informed, by a legal practitioner, as to the nature and effect of the Powers you are providing to another person(s) under the Power of Attorney document.

Video

Prefer to watch a video? Our principal, John McLaughlin, provides an informative Law Talk episode about the Enduring Powers of Attorney

will and estate planning advice

Will & Estate Planning Advice

will and estate planning advice

Here are a few ways that we at McLaughlin & Associates can help you in preparing your Will:-

  • Make sure your Will is valid – that is, properly drawn up, correctly signed and witnessed.
  • Make sure your wishes are clearly set out.
  • Make sure that you have made adequate provision for your spouse and children, including who should be legal guardian of your children.
  • Advise you on choosing an Executor, Trustee and Guardian.
  • Discuss relevant Tax Laws.
  • Advise on the possibility of claims against your estate and avoid or limit disputes between remaining family members.
  • Avoid the problems with intestacy – the imposition of a State appointed Administrator applying pre-determined rules to the disposition of your assets.
  • Keep you Will in safe custody free of charge.

Technical Terms in a Will

technical terms in a will

Testator: The person making the Will.

Testamentary capacity: Refers to the mental capacity of the testator to make a Will. The Testator must be of sound mind and at least 18 years of age.

Executor: The person appointed in a Will to manage the administration of the Testator’s estate. The executor must be 18 years of age, although does not need to have any formal qualification to perform this role.

Estate: All of the assets and liabilities of the Testator as at the date of death. As to what constitutes a Testator’s assets can be quite complex. For example, superannuation and life insurance policies do not necessarily form part of the estate. Property which is owned with another, as joint tenants, does not form part of the estate, neither does property belonging to a Trust or company, although monies owed to the deceased in a loan account of a trust or company and the shares owned by the deceased in a company do form part of the estate.

Administration of Estate: It is the Executor’s role to identify all assets and liabilities of the estate, collect the assets and pay the liabilities before distributing amongst the beneficiaries named in the Will.

Beneficiaries: The persons named in the Will who will receive a distribution from the Estate.

Death Duties: Are not currently paid in Queensland but may be payable in other states.

Intestacy: Occurs when a person dies without leaving a valid Will. Where this occurs a person is said to have died “intestate”. In these cases the assets are distributed in accordance with Schedule 2 of the Succession Act (Qld) depending upon the Testator’s circumstances at the time of death.

Family provision: A Testator’s spouse child, step-child or dependant may make an application to the Supreme Court for further provision to be made from the Testator’s estate even if they have already been provided for in the Will.

Spouse: Includes a husband, wife, de-facto partner or a former husband, wife or de-facto partner.

Child: Includes any biological child, step-child or adopted child of the Testator. The step-child ceases being a child upon the divorce of the Testator and the child’s parent.

Dependant: Any person who is being wholly or substantially maintained or supported by the Testator at the time of their death. This can include a parent of the Testator, a parent of a surviving child under the age of 18 years of a person.

Grant of Probate: The Supreme Court makes an Order that the Will is the last Will of the Testator. In a lot of cases a bank or financial institution will require a Grant of Probate before releasing monies to the Executor.

Letters of Administration: Where a person has died intestate or if there is a Will but no executor, an application is made to the Supreme Court for Letters of Administration which will allow for distribution of the Estate.

Waiting Periods: There are several waiting periods in the administration of the Estate:

  • The Death Certificate can take up to six weeks from the date of death to be issued;
  • Any person who has not been named in the Will and intends to make a claim on the Estate must give notice to the Executor within six months of the date of death;
  • For that reason it is recommended that the Estate is not distributed until nine months has passed from the date of death to ensure the Estate can meet payment of any claims;
  • Where an executor needs to apply for a Grant of Probate of Letters of Administration, notice of the intended application must be advertised at least 14 days before the application is filed in the Supreme Court;
  • A copy of the Notice must be given to the Public Trustee of Queensland seven days before filing the application in the Supreme Court.

Transmission Application: Where the Testator owned real estate it can be transferred by lodging a Transmission Application in the Titles Office.

Transmission Application by Personal Representative: This is usually done where it is intended the property be sold by the Executor as part of the administration of the Estate to meet debts and to pay out the entitlements of the beneficiaries.

Transmission Application for Registration as Devisee-Legatee: This is usually done where it is intended the property can be transferred to the beneficiary who has been named in the Will to receive that particular property.

Request to Record Death: This is done when real estate is held by the deceased as joint tenants with another person. By lodging the Record of Death the property is then owned solely by the surviving tenant.