It is never too early to start, and if you have a mortgage, a family and other assets then you should be considering starting your estate planning now.
What is estate planning?
Put simply, Estate Planning is developing a strategy or plan to deal with your assets after you die or if you become incapacitated and unable to make decisions for yourself.
Estate plans can be simple or complicated, depending on your individual financial and family situation. Owning a business, being married more than once or having children are just some circumstances that can make an estate plan more complex. It is always a good idea to consult a financial planner to help with your estate planning.
Here are a few things to consider when estate planning:
- Prepare a Will. If you don’t have a will, the state will decide who gets your property. Having a will ensures your assets are distributed the way you want them to be.
- The tax consequences of transferring assets to your beneficiaries can be varied and complex, so you will need to put strategies in place to manage this.
- Review your insurance policies and beneficiaries.
- Superannuation is not an asset of your estate, so you cannot include the distribution of super death benefit in your will. Nominating your estate as the beneficiary is one option and then your executor can distribute the funds or assets according to your instructions.
- Decide who will raise your children and devise a financial plan to take care of them.
- Create a power of attorney. For more information visit: https://greentreefinancial.com.au/power-of-attorney-what-is-it-why-do-i-need-one/
- Don’t forget to include funeral planning in your estate planning.
- Set up a Trust. It may be suitable for your circumstances to include a Trust within your estate. Through a Trust, your assets can be managed by a chosen trustee until your beneficiaries (usually your children) come to an age where they will be able to responsibly manage the assets themselves.
Benefits of having an estate plan
- Peace of mind knowing that your financial affairs are in order and will be distributed as per your wishes.
- Take care of family and loved ones. An estate plan ensures the financial security of your family should you no longer be in a position to provide for them.
- Minimise Tax. Through careful planning it is possible to distribute your assets in a way that will minimise the tax burden on your beneficiaries.
So, the answer is that it’s never too early to start estate planning. Today is the best time to put your estate plan in place so your family are looked after in the event of your death or incapacitation. Greentree Financial are experienced estate planners and can help you navigate this complicated area with an outcome that suits your individual circumstances.