Making your Will? Here are six things to consider
It’s very important that you make a Will to ensure that, on your death, your assets pass to the people that you have chosen. Before you make an appointment to see your solicitor with a view to preparing your Will, you should consider the following points:
1. What assets actually pass under your Will?
Not everything that you own at the date of your death passes under your Will. As a general rule, any assets held in solely in your name pass under your Will - for example cash, real estate and shares.
However, there are exceptions to this rule. Any death benefits payable under your superannuation and the proceeds of any life insurance policies usually fall outside of the terms of your Will as they are paid to your nominated beneficiary. In some instances, superannuation and life insurance are paid to your estate, therefore passing under your Will. It is best to take professional advice in order to check how your superannuation and life insurance policies pass on your death.
Joint assets may also pass outside of your Will. In order to determine how the asset passes, you need to understand how the asset is held. If the asset is held as “joint tenants” on the death of a co-owner, the asset automatically passes to the surviving co-owner, not in accordance with your Will. The most common example of this is a joint bank account.
If an asset is held as “tenants in common” your share of the asset passes in accordance with the terms of your Will, not to the surviving co-owner. Real estate is sometimes held as “tenants in common” although it can also be held as “joint tenants.” If you’re unsure what your real estate falls under, check your Certificate of Title as this will clearly state whether the property is held as “tenants in common” or “joint tenants.”
2. Appointment of Executors
Executors are the people who are responsible for administering your estate upon your death. They make sure that your debts are paid and that your assets are distributed in accordance with the terms of your Will.
You can appoint as many Executors as you wish. Ideally, your Executors should be younger than you or at least of the same generation. It is not advisable to appoint your parents as your Executors as they are likely to predecease you.
If you appoint only one Executor, it is prudent to appoint a substitute Executor to step in if your original Executor is unable to act. If you appoint more than one, make sure you choose Executors who have a good relationship and will be able to work together when administering your estate.
3. Appointment of Testamentary Guardians
If you have children under the age of 18, you should think about appointing someone to act as their legal Guardian. The Guardian/s would take care of your children until they reached adulthood if you were to die before they reached 18 years of age.
4. Burial/cremation clauses
Do you have strong wishes about whether you are cremated or buried? Is there a specific place that you would like to be buried or to have your ashes scattered? If so, you can include a direction in your Will which gives instructions to your Executor on how you wish your body to be treated on your death.
5. Specific gifts
Are there are any specific gifts that you wish to give? For example, you may like to leave an item of jewellery such as your wedding ring to someone in particular, or a lump sum of money as a cash legacy to your grandchildren or a charity.
Your Will can include particular clauses to ensure that any specific gifts you wish to make take effect.
6. Disposal of the “residue” of your estate
Everything else that you own once your debts have been paid and any specific gifts have been given, is usually referred to as the “residue of your estate” or your “residuary estate.” Think about who you wish to nominate to receive the residue of your estate.
Often people wish to leave the residue of their estate to their husband or wife. If your husband or wife dies before you, you may want your children to inherit the residue of your estate. Often people, for one reason or another, do not make equal provision or any
provision at all for their children, especially where there are estranged children. This should be discussed with your solicitor in order to minimise the chances of someone making a family provision claim against your estate because your Will did not adequately provide for them.
More information on making a Will is available in our Plain English Guides:
If you’re considering making your Will or have some questions about the process please get in touch with our Wills and Estates team:
Louisa Daniels, Lawyer
Phone: + 61 9895 9238