Preserving your legacy with estate planning

Like life insurance, planning for the end can be a difficult and confronting process. The best way to save your family from emotional and financial hardship, should you pass suddenly or be unable to manage your affairs, is to plan your estate.

Estate planning involves making important decisions as to who will be managing your affairs, who will be inheriting your assets, and ensuring that your assets are distributed according to your wishes.

If you haven’t yet considered implementing an estate plan, here are some of the important elements.

What makes up an estate plan? 

Will
A will outlines how your assets will be distributed after your death and can include things such as who will look after your children if they’re still minors, naming an executor of your estate, charities you wish to contribute to and funeral plans.

Power of attorney
This is a person you appoint to make important decisions about your finances and healthcare should you become incapacitated, with many electing a trusted family member.

Advance health care directives
A legal document that allows you to specify your healthcare preferences such as medical treatments and end-of-life care.

Superannuation death benefits
When someone dies, their super provider typically pays out the person/persons nominated as their beneficiaries, known as the ‘super death benefit’. This nomination could be binding or non-binding. A binding nomination means your super fund is required to pay your nominated people in the proportions you have specified. A non-binding nomination means the fund has some discretion over where your money goes. 

Guardianship
Appointing a guardian for minor children will mean they will be looked after by a person you trust in the event of the parents’ death or incapacity.

Trusts
A legal arrangement where the trustee holds and manages assets on behalf of the beneficiary. Trusts allow individuals to transfer assets to their beneficiaries in a more tax-efficient manner. 

Life insurance
Incorporating life insurance as part of your estate plan means your loved ones can be financially looked after when you pass, and use the funds to pay off any debts you leave behind.

As you can see, there are quite a few elements that make up an estate plan, but overall, the main purpose is to protect your assets and ensure they’re properly distributed. Without one in place, you run the risk of them being allocated according to state law which many not reflect your preferences, your estate could be subject to higher taxes and your control is limited. It also takes the difficult decision making away from your family and beneficiaries, creating a less stressful time for them and minimising disputes.

If you haven’t created an estate plan or are interested to learn more, get in touch with our team.

General Advice Warning
The information in this presentation contains general advice only, that is, advice which does not take into account your needs, objectives or financial situation. You need to consider the appropriateness of that general advice in light of your personal circumstances before acting on the advice. You should obtain and consider the Product Disclosure Statement for any product discussed before making a decision to acquire that product. You should obtain financial advice that addresses your specific needs and situation before making investment decisions. While every care has been taken in the preparation of this information, Infocus Securities Australia Pty Ltd (Infocus) does not guarantee the accuracy or completeness of the information. Infocus does not guarantee any particular outcome or future performance. Infocus is a registered tax (financial) adviser. Any tax advice in this presentation is incidental to the financial advice in it.  Taxation information is based on our interpretation of the relevant laws as at 1 July 2020. You should seek specialist advice from a tax professional to confirm the impact of this advice on your overall tax position. Any case studies included are hypothetical, for illustration purposes only and are not based on actual returns.