Have you sorted your Will?
There’s a common saying “nothing in life is ever certain except death and taxes”. While often said in jest, there is also a ring of truth to it. Death is certain, and as such, it is important for you to be prepared.
Have you ever thought about how you want your assets dealt with when you pass away? It is a common misconception that our assets automatically go to our family members, however this may not be the case. Do you have a precious heirloom that you want to make sure gets passed down to your child? Are you particularly encouraged by the work that a charity is doing and wish to leave them a financial gift? Do you currently have a Trust in place? The process of drafting and executing your Will ensures that you have thought about what you want to do with your assets and that your specific wishes have been properly recorded.
WHAT ARE THE CONSEQUENCES OF DYING WITHOUT A WILL?
When a person dies without having a Will in place, this is referred to as dying “intestate”. In a situation like this, how a person’s assets are dealt with and divided will need to be in accordance with the Administration Act 1969. If you have a single asset that is worth more than $15,000.00, an application will need be made to the court to appoint an Administrator. While it is a family member who will usually be appointed as the Administrator, there are specific rules on who has the right to be appointed. Furthermore, the administrator has no power to decide how your assets are divided, rather the division must be in accordance with the Administration Act.
For example, if you die without a Will and you have a spouse and children – your spouse would be the first to receive from your estate. They would be entitled to the following:
All your personal belongings including clothing, cars and jewellery;
The first $155,000.00 of funds in your estate;
Any remaining funds in the estate would then be divided into three - your spouse being entitled to the first third with the remining two thirds being divided equally amongst your children
On the surface, the above-mentioned division may not seem that consequential – however problems can arise especially if the main asset is a home. For Example – If there is property that is worth $1,000,000.00 and a half share of the property belonged to the spouse who passed away, the surviving spouse would be entitled to the first $155,000.00. The remaining $345,000.00 would then be divided into three, with any children being entitled to two thirds of this amount ($230,000.00) in equal shares.
This amount would be what the children are legally entitled to and if the surviving spouse could not afford to pay this, it could lead to the house needing to be sold. The parties entitled to receive (which in the case explored above is the children) could agree to receive less or nothing at all – however any such agreement would need to be made by all children unanimously and be recorded in writing.
If any of the entitled parties are under the age of 18, they would be too young to enter into any such agreement and an order would need to be sought from the court for their agreement to be validated. If you do not have a spouse but you do have children, then the whole of your estate would be divided equally amongst your children. Your parents would be the next in line to receive your estate if you have no children or spouse at the tie of your passing.
Should you pass without surviving parents, spouse, or children – it is your siblings who would be entitled to your estate. Lastly, if you were to pass intestate and no immediate or wider family members are able to be found, then it is the government who would be entitled to receive the whole of your estate.
HOW CAN I ENSURE THAT THE DECISION ON WHO MY ASSETS GO TO REMAIN WITH ME?
The only way to make sure that the decision remains entirely yours is to make a Will. The time after a loved ones passing is usually difficult. It tends to also be very busy with numerous decisions and preparations needing to be made in a timely fashion. Having a Will in place will make it a lot easier for your family.
The team at Sutcliffe Matson Law are ready to assist you, to ensure your Will is in order. Whether you wish to make a Will for the first time, or update your existing Will, our friendly team is aware of the court’s requirements. We can walk you through this process and include the required wording to help ensure that your Will is validated when the time comes.
Please call us on (09) 279 8351 to arrange an appointment to discuss your Will.