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Why estate planning really does matter

Estate planning goes further than simply ensuring you have a will. It involves consideration of things like advice to assist tax minimisation, risk mitigation, discretionary trusts and superannuation.

A will cannot stipulate what happens to superannuation upon death and often it’s a substantial asset that must be thoughtfully dealt with in relation to the areas of tax and risk. Binding death benefit notices, where allowed by a super fund, expire and may not be updated again prior to death. In addition, such notices are simple and may not be adequate for a more complex asset structure. In instances such as these, it may be worth exploring whether a self-managed super fund is a better vehicle for protecting superannuation.

Certain beneficiaries have higher risk profiles than others. For example, someone who gives advice for a living, such as a doctor or engineer, have a high risk profile because they could be sued and lose the inherited assets as a result of a lawsuit. A different structure would be required in this instance to ensure that the assets are adequately protected.

Another risk factor could be a beneficiary who goes through a divorce and loses the inherited assets through the settlement.

An increasingly common scenario occurs when a person has more than one marriage, and children from each relationship. When that person dies, there can be bitter disputes between the current spouse and the children from the first marriage.

Estate disputes can also arise when someone loses capacity through age, illness or accident; or through disability will never have capacity.

Unless the estate has been established in a way that fairly protects all parties, it’s not unusual for litigation to commence.

Such situations highlight the complexity of the financial management of assets, and that expert advice should be sought in order to protect your wishes and assets.

If you have any questions relating to planning your estate, please be in contact with us on advisorsupport@cbfinancial.com.au or call us on 07 3223 6000.

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Brisbane, 4001
Ph: (07) 3223 6000
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