WHY MAKE A WILL?
Your personal affairs affect you, your family and your business or profession. It is important to plan and regularly review such matters which include Wills, personal planning, estate planning and business succession planning.
A Will determines who gets control of your property and assets, and offers protection for your family in the event of your death.
Your Will should be an important part of your personal and business planning.
Death is a very distressing event for your family and friends. Your planning in making a Will can reduce their concerns and be of comfort to those close to you as they know and carry out your wishes.
DO YOU HAVE A WILL?
There are many reasons why you should make a Will. Most importantly, a Will is the legal means by which you can determine what happens to your property and assets upon your death. By making a Will, you decide who is (and who is not) to benefit under your Will. Your Will is a confidential document and its terms do not need be disclosed until after your death.
It is important to comply with formal legal requirements for the Will to be valid. A will has no effect until death and therefore it can be made and then altered at any time.
Your Will should be kept in a safe place where you or your executor or your solicitor can locate it if necessary.
YOU, THE MAKER OF THE WILL
A Will is a document by which you, the maker of the Will (the 'testator' (male) or 'testatrix' (female)):
- appoint someone to act as an executor/trustee of your Will to carry out your directions; and
- dispose of property to designated persons known as beneficiaries
Beneficiaries are those who are to receive property under your Will. You can nominate any person or persons who you wish to be beneficiaries under your Will.
Beneficiaries need not be people - companies, schools, charities, institutions etc., can also receive something under your Will.
If the beneficiaries are to be children and you wish to leave property to them you may delay when a child is to receive property. For example, until he or she reaches a certain age (i.e. 21 or 25). You can leave a discretion to your executor to give the child all or part of the property earlier - usually for education or other personal needs.
The 'Executor' (male) or 'Executrix' (female) is the person who will distribute your property according to the directions which you provide in your Will. The executor can be a family member, a friend, your solicitor, a trustee company or anyone else you choose.
As executor the person you nominate will often make important decisions about how to manage and invest your property over a period of time. Therefore, you should carefully consider who you want to be your executor. The person should be someone you can trust to carry out and understand your wishes.
You can choose more than one person to be an executor. As the position of executor involves some responsibility, you should obtain the person's consent before nominating him or her to be an executor.
Executors can have a large discretion in the way they will deal with your property. However, it is possible for you to state your wishes as to how you want your executor to deal with your property.
When property is left to children, the executor will usually act as a trustee, looking after the property until the children are entitled to take a share in the estate. It is important to think carefully about what you would like done with the property during this period including providing for their education, maintenance and personal needs.
What if an executor dies before you do?
Your Will should nominate someone else to take over the role of executor should an executor die before you do or not be prepared to act as executor.
Generally, the welfare of your children will be the responsibility of the surviving parent. However, in the event that your partner or ex-partner dies before you do, you should nominate a guardian to take care of your children.
A guardian will look after your children and make all the decisions that you would normally make as a parent. You can nominate one or more persons to be a guardian. They may be a married couple or otherwise. A guardian assumes a great deal of responsibility. Therefore, you should nominate someone you can trust and ask the person(s) if they will be the guardian before nominating them.
There is no obligation on the guardian you choose to take on this role and responsibility.
WHAT PROPERTY CAN YOU DISPOSE OF IN YOUR WILL?
You can and should dispose of all of your real (house or land) or personal (superannuation, money, shares, furniture, personal items) property in your Will.
If you want to leave particular personal items to people it is important that you are able to accurately describe those items. It would also be helpful to place a label on them identifying them by number and/or who is to receive them. This avoids any problems later in discerning what items are to go to particular people. Your Will can provide for you to make a list of such items. You can easily amend that list from time to time. The list should be dated, signed by you and kept with your Will.
Any liabilities (mortgage, credit cards, personal loans, unpaid accounts etc) which you may have at your death should also be taken into account in preparing your Will.
MATTERS AFFECTING YOUR WILL
Companies and Trusts
If you have a company through which you operate a business or hold assets or that company is the trustee of a discretionary (family) trust or unit trust which operates a business or hold assets - then you need to consider what specific provision needs to be made in your will concerning the company and the relevant trust and their operation after your death.
When you marry, the provisions of your Will relating to your spouse (e.g. a bequest to or appointment of your spouse to a role under your will) continue to apply. You can make a Will in contemplation of your marriage to a specific person. It will only apply if the marriage takes place. You should review your Will if you are marrying, to check if it sets out your current requirements.
If you obtain a divorce, your Will is revoked in so far as it makes any provision for your former spouse. Therefore you should review your Will upon marriage and divorce.
If you do not make a Will and/or a valid Will, then in the event of your death, your property is dealt with according to legislation. This may not be in the way you would wish. Therefore, it is important to make a Will to specify your wishes.
After your death, your executor administers your Will and (depending on matters including the size of your estate's assets) must have your Will probated. Probate requires legally proving your Will, obtaining details of your assets and liabilities and ensuring that your property is dealt with in accordance with your Will and the law. The law allows certain persons to contest your Will. A well considered and prepared Will should reduce the likelihood of your Will being successfully altered by a Court.
HOW DO YOU MAKE A WILL?
We hope the above matters assist you in understanding the importance of and need for a Will.
To ensure your Will provides for your wishes and needs, we recommend that you consult a solicitor. We would be happy to help you. Preparation of a Will in not as expensive as you think, particularly in view of what it is intended to achieve (ie specifying your wishes and ensuring those you care about know what those wishes are). We would be happy to provide you with a quote for the cost of preparing your Will and to assist you with this.
This article is general in nature and for information only. It should not be acted upon without obtaining specific legal advice.
©Anne Hodgson & Co
7 Beswick Street (P O Box 173) Garfield Vic 3814 . Telephone 03 9578 7444 . Facsimile 03 8677 2962 . Mobile 0419 870 679 Email: firstname.lastname@example.org