Considerations for Complex Wills
There are certain situations where wills can become complex. This may include situations where you own a business or valuable assets, you have a blended family, you wish to set up a trust for disabled child, or you wish to establish a trust for your children to receive money after they come of age. In complex circumstances such as these, the executor of your will may be obligated to apply to the Court to seek an order to acquiesce the intended meaning of your will. Not only could this lead to unintended results, but it could also lead to a large bill payable by your estate.
Blended Family Wills
Particular attention should be placed on blended families, as one of the most common reasons for contesting a will. If you or your partner has a child from a previous relationship, you will fall into the category of blended family. Estate planning should be carefully and comprehensively attend to, so as to ensure that your estate goes to all of your intended beneficiaries.
To understand how estate planning differs for blended families, it is helpful to consider the common process for traditional families. When neither partner of a couple has children from a previous relationship, the estate will firstly go to the surviving partner. The remaining estate will then pass to the couple’s children upon the surviving partner’s death. Because of the relatively straightforward process, usually the surviving spouse or one of your adult children is appointed as an executor.
In a blended family, this is not the recommended process. You may not want your biological children to wait until after the death of your surviving partner to receive any assets. Instead, you may consider providing them an immediate gift upon your death, whether that be money or other assets. You would also like to protect against the risk that your surviving partner may change their will to remove your biological children from obtaining any of your assets. Because of the real potential for competing interests, it is often advised to appoint a neutral party as the executor.
Top Tip for Complex Wills
One of the most common concerns when drafting a complex will is the depreciation of assets. This can include the risk of claims from third parties, such as creditors. It is here where testamentary trusts should be considered. You will nominate your beneficiaries and outline what you wish for each beneficiary to receive from your estate. Testamentary trusts are flexible in that the executor can decide which beneficiaries receive their benefit at a particular time. This temporal flexibility can mean tax efficiency and additional protection from third-party interests.
Are you looking for an experienced asset protection or estate planning solicitor in Newcastle, Sydney or the Hunter to assist you in your legal matter? Call us on (02) 4929 7002, email us or complete an enquiry form.