Hypothetical by Manny Wood Published in the Coffs Coast Advocate on 11 January 2020.
Jack and Jill make a New Year’s resolution to get their estate planning up-to-date. This has been their same New Year’s resolution for several years now.
Jack and Jill attend an appointment with their estate planning lawyer and they first discuss their wills.
Jack and Jill advise the lawyer that they have a blended family. This means that they both have children from a previous relationship. They are advised that they can make relatively simple wills at minimal cost that will reflect their wishes but that these simple wills may be at risk of being contested and may also ultimately not achieve their goals of providing adequately for each other as well as their respective children.
They are advised to consider more complex wills that put in place flexible life interests, which allow the surviving spouse to reside in their matrimonial home for life. These types of wills can also allow the executors to sell the home and purchase another property if their spouse wishes to relocate. These will also cater for other types of accommodation that may be required, such as nursing home bonds. These wills ultimately protect the capital of their respective estates for their children. For these wills to operate effectively, their matrimonial home needs to be owned by them as tenants-in-common.
The solicitor also advises them of more complex wills, known as testamentary discretionary trusts. These wills are more costly and more expensive to administer but have benefits, particularly in large estates in terms of asset protection and tax.
Jack and Jill are also advised of the importance of putting in place Enduring Powers of Attorney and Appointments of Enduring Guardian.
If you would like Manny to address a particular legal issue, send your request to manny.wood@ticliblaxland.com.au or call him on (02) 6648 7487.
