07 Jun Signs that you need to update your estate plan
Getting an estate planning lawyer on your side is an important part of managing your affairs after death. The legal protections offered by an expertly crafted estate plan are crucial to making sure that your wishes are followed after your eventual death.
However life changes faster than we think and the circumstances under which an estate plan was originally created change with it. This is why it’s prudent to keep in regular contact with an estate planner so that you can make sure you and your estate plan are on the same page.
Let’s take a look at some of the top signs you need to update your estate plan.
In the case of a spouse’s death the surviving person is usually very grateful to have their affairs in order so that there can be a hassle-free transition of assets. However, the death will require a complete review of the estate plan and the objectives it follows.
If a family is left with a single parent then that parents needs to review their estate plan and consider the assets given to children and how they will minimise superannuation taxes for death benefits as well as succession planning.
If someone gets a divorce then their existing will is revoked automatically. This means that that updates to the estate plan need to commence once the decision to separate has been reached.
Often divorce will require changes like writing a new will and changing nominations for superannuation benefits. People in this situation should not wait until they are officially divorced to begin making these arrangements.
Children grow up
When children are still at school age, estate planning involves making sure assets are available to continue their education after the death of a parent. These funds are securely held in an asset and tax protective manner.
When children get older the strategies used in the estate plan are less concerned with education and are tailored towards their own family relationships.
When children reach the age of 18 they become financially independent and any superannuation death benefits paid to them will be taxed. In this case the estate plan will need to be altered in order to minimise the amount that will be taxed from payments to financially independent children.
The decision to hand over control of a family business to a child needs careful planning along with an update of the estate plan. These plans should be executed around the same time and clearly communicated with family members in order to maintain harmony between successors.