What is estate planning and why should I care?

Posted on July 13th, 2017

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Estate planning refers to the planning and arranging, during your lifetime, for the management and disposal of your estate (i.e. assets) while you are living and after your death. It is a complex area of law and, without proper consideration, there can be significant consequences for both you and your family.

 

Will – A will is a written legal document which sets out the distribution of your property after death.  While many people believe making a will is too costly and a waste of money, the reality is that if you die without a will (intestate) the cost of administering the estate can be substantially higher and the estate will be divided according to a statutory formula which may not be in line with your wishes. While you may prefer not to think about what would happen if you were to die, it is important to ensure there are instructions for distribution of property amongst those you leave behind.  By making a will, you decide who will be your legal personal representative after death (your executor) and who will receive your property (the beneficiaries).

Power of Attorney – Powers of attorney are a popular legal document.  Used responsibly, a power of attorney can provide peace of mind as it enables you to appoint one or more adults (your attorney/attorneys) to make business decisions for you. It is wise to ensure that the power of attorney is enduring, meaning it continues in the event you lose legal capacity. The power of attorney can commence immediately after being signed or at a future time and can include conditions or be unconditional. Importantly, you must trust your attorney without reservation.

Appointment of Enduring Guardian – An appointment of enduring guardian allows you to appoint one or more adults (your guardian/guardians) to make lifestyle and medical decisions for you. This is different to a power of attorney as a guardian makes different types of decisions to an attorney. Unlike a power of attorney, an appointment of enduring guardian can only take effect if you are unable to make your own lifestyle and medical decisions. A medical practitioner can assist in deciding when the appointment becomes effective.

Take home message – It is extremely important to obtain legal advice which is tailored to your specific circumstances. Estate planning is an area where a “one shoe fits all” approach cannot be taken. Without proper advice, you risk not having adequate provision in place for decision-making during your lifetime and distribution of assets after your death.

Lana Black, Solicitor at Mullane & Lindsay Solicitors, NewcastleLana Black is a Solicitor at Mullane & Lindsay Solicitors and practices extensively in estate planning and administration. If you require any assistance in this area please contact Lana Black to arrange a consultation or contact our Newcastle office.

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