Most people wouldn’t consciously decide to leave a mess for their family to tidy up after they die but a lot of Australians do.
About half of Australians die without a valid will. Of those who do have a will many don’t have the associated estate planning documents necessary to
- control the distribution of superannuation death benefits or insurance payouts or
- shield nominated beneficiaries from unnecessary taxes or estate challenges
Passing away without an up to date, valid and carefully conceived will have dire consequences for your family. It may spark family disharmony and worry, result in unintended distributions, lengthy and expensive litigation, unnecessary tax consequences and loss of assets.
Suffering an injury or losing your capacity without an enduring power of attorney in place, may result in a government-appointed stranger making decisions on your behalf, rather than someone whom you love and trust.
The question is why we procrastinate and don’t get onto our estate planning?
From our experience it is due may be due to many reasons including;
- Already have a will and unaware of the importance of associated estate planning
- Confused or put off at the research stage
- Concerned about the expense
- Thinking we still have many years left
- Waiting on something before getting started
- Believing an estate may be too modest to warrant a plan
- Feeling too busy to attend to it
- Waiting to accumulate more assets
- Hoping the Government will sort it out so why bother
- Discomfort with acknowledging one’s own mortality
If you have experienced any of these or know anyone who has read on. We will give you some insight that may help get started and you show your family how much you care.
Already have a will and unaware of the importance of estate planning
Many circumstances arise that necessitate a review of your will and associated estate planning documents. There is a misconception that if you have a will, you have an estate plan. That is a myth. A proper estate plan also includes a suite of other documents such as superannuation death benefit nominations, enduring powers of attorney and health care directives. It may also involve preparation of special trusts to minimise taxes paid by your beneficiaries, to protect vulnerable beneficiaries or to protect inherited assets from creditors and estranged partners.
Confused or put off at the research stage
This is an understandable misconception. It is a confusing marketplace for Australian will-makers and estate planners.
Wills and estate planning are made to seem simple and relatively unimportant by businesses marketing online wills and will kits. This makes people oblivious to what is at stake for their families.
This may be confused further by advisors offering advice and discount wills in this complex area of the law requiring expert knowledge.
Then it is made to seem overly complex by some expert estate planning lawyers who in some cases, over-supply documentation, causing the average Australian to question the advice or put things on hold until they can understand or afford it.
By the way, we offer affordable fixed fee services and supply what is required by each individual.
We have invested a lot of time into breaking down this complicated area into information packs and tools for our clients and the public. If you lack awareness, hopefully, we can improve that, and you can start getting your affairs in order.
Concerned about the expense
An estate plan is an expense I can’t afford it right now.
The fear of what it might cost is a huge deterrent for many people. And, if you are from the top 1% of wealthy families, it could cost a lot. For most, it should be affordable and worthwhile.
Our fixed fee services are affordable (from $395) and the cost of an estate plan might be much less than you expect.
Most of us spend our lives working hard to build our wealth and assets.
Doesn’t it make sense to invest in professional fees now to avoid unnecessary taxes, maximise the amount and longevity of the legacy you leave behind and preserve family harmony later on?
When you consider the high cost to your beneficiaries, if you don’t have an estate plan, the cost of developing one is inconsequential. You can access our fee guidelines here.
Thinking we still have many years left
Many people believe they are still young, or in good health and don’t need to get their affairs in order right away.
Unfortunately, we don’t all float gracefully into old age and we don’t have a crystal ball. We hate to state the obvious, but many of us die unexpectedly or suffer a medical condition leading to a premature death. Heart disease, diabetes, cancers, lung diseases, intentional self-harm and accidents claim many Australians each year, long before their time.
Believing an estate may be too modest to warrant a plan
No everybody feels rich, has multiple properties and a private jet but we still need to plan our estates.
Over the past few decades skyrocketing house prices, compulsory superannuation, life insurance and the increasing complexity of estate and succession laws have meant most Australians require an estate plan. Even those of us who have modest estates generally need to have a quality will and an enduring power of attorney at the very least.
Waiting for something to get started
People think it is a good idea to have everything resolved before they get started. They might be waiting on something like clearing a mortgage or to see how a child’s de facto relationship might turn out.
If you are waiting for something before you get started, remember well-drafted documents usually include multiple contingency clauses, often enabling you to finalise documents now and avoid multiple updates in the future.
Too busy to attend to it–I’m time poor
Everybody seems time poor nowadays. Organising a will and an estate planning strategy can get pushed to the back burner.
If you have time to see a movie, go to the dentist or work out at the gym – you have time to discuss your estate planning. Preparing a will and estate plan should really be at the top of your priority list. It means that you value yourself and your family enough to do what’s best for your loved ones’ future security.
In actual fact it only takes a few hours to get a plan in order and finalised and It only take 30 seconds to have a car accident.
Waiting to accumulate more assets
Many of us hold off because we think that the full financial plan and wealth accumulation stage must be complete prior to addressing our estate plans. However, a decent estate planning lawyer will future-proof documents to minimise future revisions and ongoing expenses.
Hoping the Government will sort it out so why bother
The Government’s formula to distribute one’s assets is not aligned with most people’s wishes, or the best interests of their beneficiaries, regarding challenges or taxes. It has no way of knowing if you want to exclude someone and why. It is better for you to create an estate plan to provide for your family. The government’s distribution formula does not take into account the best way of minimising tax payable by your beneficiaries or how to protect their inheritance from claims.
Discomfort with acknowledging one’s own mortality
As for our innate displeasure at acknowledging our mortality. Experiencing anxiety when thinking about death is natural, but, unfortunately, it is hard to recognise in our selves. We all have it to a different degree. Preparing a will requires an acknowledgement of your own mortality.
The technical term for this type of anxiety is thanatophobia. Of course, death is a natural thing and it’s also inevitable. Many of our clients tell us how relieved they are and how much better they feel after preparing their will.
When we take into account the various studies conducted by Australian Universities and Palliative Care Australia the statistics point to an issue. It is clear that most of us want to leave our assets to those we love and want to nominate decision makers for when we lose capacity, but only about half of us get around to it.
- 48% have a will
- 50% (roughly) die without a will
- 24% of us have a Power of Attorney
- 74% agreed they should plan their end of life care, but fewer actually do so
So now you have heard the main reasons people procrastinate, What do you want to be remembered for?
Do you want to be remembered for prioritising your family or allowing procrastination to leave a mess for others to clean up after you’re gone.