Why Make Estate Planning Documents in the First Place?
Given the rise of instances of financial elder abuse, contested wills due to capacity issues of the testator, undue influence and family provision claims, is it even worth having these legal documents in place, when the potential for misuse or other legal procedures are available?
The answer is yes! Although such instances exist, the alternative is decidedly more complicated and often a longer and more expensive process.
When considering estate planning documents such as enduring power of attorney and enduring guardian documents, it is essential that the person you wish to care for you or look after your affairs has the power to do so. While the potential for abuse of this power is present, without these documents, should you become incapacitated, nobody may be able to pay your bills or sell your property should you require the funds to move into a suitable aged care facility.
Mental capacity and the ability to update or make a will are interlinked. If a person does not have testamentary capacity, that is the mental ability and understanding to make or alter a will, then they are unable to instruct a solicitor to make such changes. Therefore, your age before making such documents is a consideration and the younger you are the less questions arise over capacity.
An example of the difficulties that arise should there not be a valid and up to date will is, if there is a previous will in place benefitting a previous de-facto spouse, and the testator becomes mentally impaired prior to making a new will, the previous spouse would receive all the testator’s assets, any children or other important people in the testator’s life would not receive any benefit.
This would likely lead to a will dispute and family provision claims, with the costs of defending such claims would come from the estate, making the final distribution to the beneficiaries less than initially intended.
The above scenarios may not be at the forefront of your mind, but consider the following situations:
- suddenly coming into money through inheritance given by your parents or grandparents.
- starting a new business, not only the business’s profit but any assets under the business’s name.
- a young person’s largest asset may be their superannuation which may contain a death benefit; and
- if there is any life insurance policy in place,
It is important to have in place an up to date will and estate plan, otherwise the distribution of assets will likely follow the rules of intestacy rather than what you wish.
More Information
If you wish to obtain further information, advice or assistance in updating your Will, please contact one of our Will Lawyers in our Estate Planning team at Matthews Folbigg on 9635 7966, email us at estates@matthewsfolbigg.com.au or through the website www.matthewsfolbigg.com.au
DISCLAIMER: This article is provided to readers for their general information and on a complimentary basis. It contains a brief summary only and should not be relied upon or used as a definitive or complete statement of the relevant law. Liability limited by a scheme approved under Professional Standards Legislation.
