5 Estate Planning Mistakes That Can Cost Your Family Big Time
Estate planning is one of the most important steps you can take to ensure your family is financially secure after you’re gone. Unfortunately, many people overlook crucial details, which can lead to costly consequences for their loved ones. Here are five common estate planning mistakes and how you can avoid them.
1. Not Having a Will
One of the biggest mistakes people make is not drafting a will. Without a valid will, your estate will be distributed according to the laws of intestacy in Victoria, which might not reflect your wishes. This can cause delays, extra legal costs, and potential disputes among family members.
2. Failing to Update Your Will
Life changes, such as marriage, divorce, or the birth of children, should prompt an update to your will. If you don't regularly review and adjust your estate plan, outdated provisions could exclude new family members or create confusion about your intentions, leading to family disputes or even legal challenges.
3. Not Planning for Tax Implications
Many people overlook the tax consequences of their estate plans. For example, capital gains tax may apply when assets like property or shares are transferred to beneficiaries. Proper planning with the help of a lawyer or accountant can minimise tax liabilities for your heirs, ensuring they keep more of what you leave behind.
4. Ignoring Superannuation and Life Insurance
Superannuation and life insurance often sit outside of your will. If you don’t have valid beneficiary nominations, these funds may not go to your intended beneficiaries. Worse, they might be subject to delays and potential tax issues. Always ensure your nominations are up to date and align with your overall estate plan.
5. Not Appointing the Right Executor
Your executor plays a key role in managing your estate. Choosing someone who is not up to the task, or who has a conflict of interest, can result in delays, mismanagement, or even disputes. It’s crucial to select someone trustworthy, organised, and capable of handling the responsibilities.
Estate planning may seem complex, but avoiding these mistakes will save your family a lot of stress and potential costs. By taking the time to plan properly, you can ensure that your wishes are carried out smoothly and your loved ones are taken care of.
We’re here to help with estate planning and family law. Call (03) 9028 7603 or email us at info@webwills.com.au. Let us assist you in securing your family's future.
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This is a commentary published by WebWills for general information purposes only. This is not meant to be taken as particular advice. You should seek your own legal and other advice for any question, or any specific situation or proposal, or get in touch with the writer at http://webwills.com.au before making any final decision. The content also is subject to change. A person listed may not be admitted as a lawyer in all States and Territories.
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