As much as it is inevitable, death is nonetheless a surreal concept for many of us. It’s not tangible; it’s hard to grasp. It’s sad, of course. Devastating, even. But unless you’re battling a terminal illness or approaching your 100th birthday, it can also seem like something you honestly don’t ever expect will happen to you. Or at least, not yet, anyway.
Admittedly, you might talk about it with your friends and family in a hypothetical sort of way. ‘I want white doves released at my funeral, while the dulcet tones of Michael Buble blast through a speaker,’ you might say. ‘I want my wake to be a full celebration, with party pies and champagne, and for my ashes to be scattered under the oak tree where we pledged “til death do us part”.’ And you’ll smile, and go about your day. Life goes on… until it doesn’t.
It’s easy to understand – given how far away death might seem – why many people put off the essential ‘life admin’ of getting their affairs in order. Last wills and testaments, preparing estates, or getting your superannuation and life insurance sorted, you feel like you have forever… until for some, it becomes too late.
Don’t leave yourself exposed
Estate planning specialist and principal lawyer at MistryFallahi Lawyers, Bhavesh Mistry, has heard it all before. From ferocious stoushes over who gets what, to family members contesting wills and becoming embroiled in lengthy court battles, to clients not leaving any indication of where they want their assets to go – it can all add to the trauma of loss. All too often, Mistry has had to consult with clients whose loved ones have shuffled off their mortal coil leaving their family nothing except a period of mourning – and the extra grief of having to sort out their estate.
‘It’s like the saying goes: you don’t know who’s swimming naked until the tide goes out. A lot of people don’t realise the importance of doing a proper will, until it’s too late,’ he says. ‘I often get children ringing me to say their mum or dad has passed, and they thought they had a will but it was a topic they never really discussed. It turns out they didn’t get their affairs in order, so what do we do now? A document that can be put together relatively quickly can save years of heartache.’
It’s never too early to be prepared
According to NSW Trustee and Guardians, studies show that at least 45 per cent of Australians do not have a valid will. It’s a sobering statistic. Not leaving a will means your estate is distributed ‘according to a pre-determined formula’ – and may even pass on to the government if your only living relatives are more distant than cousins. It’s also extremely important to get your life insurance and superannuation in order, to ensure you can take care of your loved ones once you’ve gone.
So when should you think about putting your final wishes in black and white?
‘The textbook answer is as soon as you’re over 18, but generally people start looking at doing a will when they have something more than themselves to consider – not monetary assets, but relationship-wise. When you have a child, that’s probably the biggest point when you think, it’s time we got this done,’ says Mistry. ‘Forget about the money – you have to consider who you will appoint to look after your child in the event that something happens to you and your partner. It’s a confronting question, but one that needs to be addressed.’
‘Of course, if you’re worth a million dollars and single with no dependants, you might not think of preparing a will because you don’t have anyone to provide for – unless you’re passionate about a particular charity. But when you enter a relationship, have children –– you ought to speak to an estate planning solicitor and get it done properly.’
Keep it to yourself
Aside from having the hard conversation with loved ones about making sure they have a will in place, Mistry’s rule-of-thumb is to not talk to your beneficiaries about its contents. Circumstances can change, relationships can blow up, families can fall out. A last will and testament is a deeply personal directive. The most important thing is that you know where you want your assets to go, and that you legally safeguard those wishes as effectively as possible, to avoid potential contests and conflict once you’re no longer around to speak for yourself.
‘When you see a professional estate planning lawyer, they can give you advice about your obligations at law – not morally, but at law – and you can then make an informed decision about how you want to divide your estate,’ says Mistry. ‘There are mechanisms and strategies we can employ if we think the estate might be disputed. A simple example is superannuation. You can nominate your superannuation to go to a dependent beneficiary, for example—in which case it makes it more difficult to dispute—rather than giving it to the estate, which would mean there’s more money in the estate to be fought over.’
It’s useful to know that there’s no death tax in Australia – but if you inherit a property, you may have to pay capital gains tax. Mistry says it’s also worth noting that if your life insurance is held within your super and you bequeath it to a non-dependant, you or the estate may be liable for tax. The same goes for foreign beneficiaries. It can be a complicated process, so having a trusted specialist on board can eliminate a variety of potential headaches.
All in the detail
So, congratulations – you finally decided to make a will. You may think that all you want is a simple document and that the lawyer down the road can sort it for you for a swift hundred bucks. But there’s more to it than the ‘simple piece of signed paper’ – and beware of unqualified ‘experts’.
‘Consider this scenario: you give all your shares to your children. That seems fair, doesn’t it?’ asks Mistry. ‘But what if I give all my shares to my children, equally? That changes it. And again – what if I give all my shares to my children equally, free of all encumbrances and taxes? You can see the first clause has a dramatic difference to the third clause. You may think your circumstances are simple, but that’s not how you should look at it. You need to have a will that’s been tailored to your specific circumstances.’
Mistry also suggests reviewing your document in the event of a major life change – or at least every three years – just to make sure it’s all still okay.
Of course, acknowledging the inevitability of death can be a confronting process. Writing a will requires facing up to your mortality – a sad circumstance of the human condition. But knowing you’ve done your duty, signed the right forms, instituted the right clauses, and taken care of loved ones that matter to you will ensure your most important wishes of all will come to fruition. After all, we’ll want everyone to remember us for all the good things about our lives – not a mess we’ve inadvertently left behind in death.