Do you have an Estate Plan, a Will, an Enduring Power of Attorney and a Medical Power of Attorney (or Guardianship)?
There is no good reason not to have these fundamental estate planning documents in place.
If you have a Will, you should ensure that it is up to date, and has been drafted with proper regard to your personal, family, business and investment structures. You also need to take into consideration the commercial and taxation issues associated with these structures.
Do you have a “family trust”, “investment trust”, “farm trust” or “business trust”?
You can not deal with trust assets in your Will. This is because trust assets do not form part of your personal “estate”. Passing control of assets held in a trust is not a simple matter, either when you are alive or when you die. You need to deal specifically with trust assets.
Do you carry on a business, either in your own name, or through a trust, partnership or company?
How well are your personal and business assets protected from unjust claims? How much thought have you given to the “exit” – either planned or unplanned. How do your insurances tie-in. Will you end up in business with your partner’s spouse? What tax issues will arise on the sale of your business, have you optimised your business structure and exit plan?
Do you have children who carry on a business or are engaged in a “high-risk” profession (e.g. a company director, doctor, lawyer, accountant, engineer, etc)?
If you leave assets to these children you are only making them a bigger target for potential claims. There are ways to protect their inheritance from unjust claims.
If you personally carry on a business or are engaged in a high-risk profession, how well is your inheritance protected from unjust claims? Have you discussed this with your parents?
Do you have divorced children, or children at risk of divorce? Have you considered how to safeguard any gifts to such children to ensure that the assets stay within the family?
Do you wish to leave certain family members out of your Will and minimise the chances of your Will being successfully challenged?
Do you have dependent children, either under 18 or with some form of disability?
Who will look after the children if you die or become incapacitated? Will the carer have a big enough house and car to properly look after your children? What school will your children go to; will they be able to afford to attend university, who will fund their travel? On the other hand, will there be any money left when your children are old enough to take control of their own affairs?
Do you own shares in a company?
Who will control these shares, who will be appointed a director of the company and how should they act? Are there any director/shareholder guarantees in place – how will these be satisfied or replaced? Is there a Shareholders’ Agreement – and does it contain appropriate “succession” clauses?
Do you have a “DIY” super fund?
Who will control the assets if you die or become incapacitated – who will be the trustee? Have your pensions been structured properly, with appropriate reversionary clauses? Is the Deed up to date, providing for the full range of possible pension benefits, binding death nominations, and the proceeds of any life policies held in the fund?
Do you hold “income protection”, “business interruption” or “life and disability” insurance policies?
Who owns the policies, are they held in the appropriate entity (e.g. in your own name, in a super fund or through a proceeds trust)? What tax deductions can you claim for premiums, and what will be the tax treatment of any payout?
Do you own one or more investment properties?
Who holds the title and in what capacity, what is the extent of cross-security, have you forgone “asset protection” to access to “negative gearing”, are you paying too much land tax? If you hold the property with a third party, have you agreed on how income and expenses will be shared, how the property will be managed, who will hold property-related documents, and who and when will you “exit” the property?
Do you have significant loans – both with related entities and banks?
From what assets will these loans be paid off if you die or become incapacitated – will that impact a specific gift to a beneficiary? Is the loan and any associated life or disability insurance held in the same entity? Are you intending to forgive any loans, and in what circumstances? If the loan is with a related entity, have you considered tax issues such as “deemed dividends” and the “debt forgiveness rules”?
Do you have children from more than one marriage?
Are all your children adequately provided for, and will any gifts be administered by someone who will act in the best interests of each child?
Do you wish to make a contribution to society in the form of a charitable gift either while you are alive or on your death?
Have you considered a “charitable trust” or “charitable foundation” and the tax consequences of charitable giving through your Will?
You need a Mid-life Legal Check-up™
If you answer "yes" to any of these questions, chances are you are in need of a Mid-Life Legal Check-up™. A Mid-life Legal Check-up™ will provide you with a structured way to work through these issues:
- To identify which issues are relevant for you; and
- To provide you with a complete plan to ensure your affairs are in order.
