This is a question that many people already ask themselves, even if only fleetingly. And coupled with the typical aussie sentiment of she’ll be alright, many simply put off finding a suitable answer to this question.
But will everything be alright if you leave this question unanswered?
What does happen to your money if you don’t have a Will?
Of course, everyone’s situation is different and depends where you live and where your property is located. It also may depend on the needs of your family members. So now things are starting to get a little complicated.
In Victoria, New South Wales and Tasmania, the situations are fairly similar. That is, if you die with a partner (married or de facto) and children, you partner with receive approximately the first $450,000 of your money. If you’re worth more that $450,000 the balance will be divided with 50% to go to your partner and the other 50% of the balance to be divided equally amongst your children (if from another partner otherwise your kids with your existing partner receive nothing in favour of your partner).
In Queensland, your partner receives the first $150,000 and generally a third of the balance, depending on what kids you have and with whom.
Western Australia’s formula is rather convoluted involving partner, children, parents and siblings. Therefore, if you live in WA, the advice is simple – just get your Will done. Likewise, in the Northern Territory where your partner gets the first $500,000 and then the rest is divided amongst your family.
In South Australia, your partner will receive the first $100,000 of your estate and half the balance.
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Is this how you would want your money shared out after you die? You’ve worked hard for it after all, so shouldn’t you get to decide rather than the government?
Your partner may in fact receive more still. If you and partner own your property as Joint Tenants, he or she will automatically receive full ownership of that property, and depending on how it is financed, your estate may be liable for the outstanding mortgage. The value of such a property doesn’t even factor into the worth of your estate and the amount to be shared, though the liability may have an impact in your estate.
Likewise, your Superannuation. If you have a Binding Death Benefit Nomination, your super will be distributed in accordance with that. If you don’t have a binding death benefit nomination the trustees of your Super fund will distribute how they see fit and possibly without regard to who received what from your estate, or perhaps they might, it’s really anyone’s guess at this stage.
If you have neither partner nor children, then either grandchildren, parents, siblings, aunts, uncles and cousins many be entitled to a share of your money. And if you have no family, your money will be forfeited to the government.
So, the answer to this question is … yes, you probably do need a Will if you have any money to leave. The advantages being:
- There is certainty over your affairs;
- Your family will appreciate that you have made an effort to take care of them;
- You can take care of family members who need it;
- Your de facto partner will not need to prove they are your partner;
- You can exclude (so long as they aren’t dependent on you or otherwise entitled) family members who you do not wish to benefit;
- You can decide who will be your executor;
- You can choose an executor who will not charge or charge reasonably;
- You can appoint a guardian to look after your children;
- You can equalise between your family members if one should receive more from your super;
- These figures will change over time, and you may not be aware of changes to the formula that would be used. A Will shall be held valid, even if the law changes if validly executed at the time.
- Writing a Will is significantly cheaper than the legal cost of disputes over an estate.
The aforesaid is not legal advice and is only general in nature. Please obtain advice specific to your own circumstances, alternatively get in touch with the writer at http://hazelegal.com.au