GUEST BLOG: The Importance of Estate Planning

At Fortress, we want our members to consider all aspects of their financial plan, even the ‘scary’ parts, like how to divide their assets if something happens to them.  Today we are THRILLED to share a blog post written by one of our Fortress Family members, Chris Sheath, of Chris Sheath & Associates, on the importance of having an estate plan, including a valid Will.

“By failing to prepare, you are preparing to fail.”  Winston Churchill

A Will is only one part of the preparation of a person’s estate plan.  An estate plan deals with what will happen to you and your assets:

  • if you become incapable of managing your affairs; and
  • when you die.

An appropriate estate plan ensures that your assets and liabilities (your “estate”) are dealt with as you intend, while minimising the financial, emotional and personal impact on your family.

What is a Will?

A Will is in fact one of the most important documents a person can have.  It enables you to specify who is to receive your estate after you die and the way they are to receive it.

It also allows you to appoint a person (an executor) to administer your estate in accordance with your Will.  You can also appoint someone to be a guardian (a testamentary guardian) for your children if they are under the age of 18 years.

If you don’t have a Will

If you do not have a Will, you are said to have died “intestate” and the law dictates who, out of your family, will inherit your estate and the person who may administer your estate (the administrator).  In some cases, the Government may inherit your estate.

This set formula for distribution of the estate is determined by law and very rarely (if ever) follows how you wish to distribute your estate when you die.

For example, if you die leaving a spouse and no children, then your estate will go to your spouse, even if you are separated (but not divorced)!

If you are survived by your spouse and children, then your spouse will receive only:

  1. the household contents;
  2. the first $150,000; and
  3. either ½ or 1/3 of the balance of the estate (depending on the number of children you have).

If there is one child, your spouse and child will each receive one-half of the balance estate.

If there is more than one child, your spouse will only receive one-third of the balance estate and your children the rest of the balance estate in equal shares.

If you die and have no spouse or children your parents will take your estate.

If your parents do not survive you, then your estate will pass to your siblings equally.

If you do not have anyone who may qualify to receive your estate on intestacy, then the Government will inherit your estate.

Where you have not made a valid Will, it is also necessary to apply to the Court to have someone appointed as administrator of your estate to ensure it is distributed in accordance with the formula prescribed by law.  If you have young children and a testamentary guardian is needed for your children, it may also be necessary to apply to the Court to have someone appointed testamentary guardian for your children.

By not having a valid Will, not only can your death have unintended consequences for your family, it in fact can have quite catastrophic effects on your family financially, emotionally and personally.

The idea of an “estate plan” (which your Will is a part of) is to ensure that your estate passes as you intend after your death with a minimum of cost, while minimising the potential and impact of claims on your estate.

What does it cost?

The most common question we are asked when it comes to estate planning is the cost.

Depending on the complexity of your circumstances, costs may vary. Our fees for estate planning services range from $330.00 for a single simple Will to $550.00 for simple “husband and wife” Wills. Some more complex arrangements including those relating to companies, trusts and testamentary trusts may range in fees from $3,850.00.

Having worked closely with Chris Black at Fortress Financial Solutions on estate plans for mutual clients, we know the benefit of the Estate Briefing Notes prepared by Fortress Financial Solutions.

For Fortress clients who come to us with the Estate Briefing Notes, we will provide the following fixed fees:

To prepare your Estate Briefing Notes and secure the above discounted fees, please book an appointment with Fortress Financial Solutions.  You can book directly on the website, or via phone 07 4646 4970 or email at info@fortressfs.com.au

Written by Chris Sheath, Director of Chris Sheath & Associates

Chris Sheath & Associates are part of the Fortress Family as they share our values, personalised approach and commitment to building a strong professional team around their clients.  To learn more, please contact Chris Sheath and his team on 07 4638 5541 or visit their website.

Preparing a Will is not a scary process (it is much scarier to die without an estate plan!), and if you still aren’t sure, please contact us here at Fortress. We are happy to give you some guidance and hold your hand through the process.

 

Corporate Authorised Representative of Magnitude Group Pty Ltd ABN 54 086 266 202, AFSL 221557.

This information is of a general nature only and has been provided without taking account of your objectives, financial situation or needs. Because of this you should consider whether the information is appropriate in light of your objectives, financial situation and needs.

Information on this site may be regarded as general advice. That is, your personal objectives, needs or financial situations were not taken into account when preparing this information. Accordingly, you should consider the appropriateness of any general advice we have given you, having regard to your own objectives, financial situation and needs before acting on it. Where the information relates to a particular financial product, you should obtain and consider the relevant product disclosure statement before making any decision to purchase that financial product.

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