FAQ
What is Estate Planning?
Its extremely important that your loved ones are looked after and that your estate is distributed fairly in the event of your death. The last thing you want is your family to be in dispute while grieving.
Estate Planning allows you to have certain things in place when you die or are incapable of making your own decisions. You need to think about having one or more of the following in place:
- a Will, which enables you to make the decisions about your estate
- a Power of Attorney, which enables you to gain assistance in looking after your estate
- an Appointment of Enduring Guardian, which ensures your wishes are upheld if you became incapable of making decisions.
2. What happens if you don’t have a plan?
When there is no plan in place, your estate becomes subject to special rules as to who is entitled to your property and assets. Such rules are dependent on your personal circumstances, such as whether there is a spouse or de facto partner; children; or parents or siblings.
These rules may not represent your wishes and they could also lead to disputes in the family or among friends.
Your spouse, or an adult child or a parent, may have to apply to be appointed as administrator in order to deal with your property.
Such outcomes may not be what you want so if you have specific wishes, it is essential to have a plan in order to ensure your wishes are carried out.
Your Carroll & O’Dea lawyer can help you with estate planning.
3. How often should I review my Estate Planning?
You should review your estate planning every three years, or whenever your personal circumstances change, to check your plans are still relevant and in accordance with your wishes.
4. What is the role of the Executor?
An executor is a person you appoint under your will to administer your property and to carry into effect the provisions of your will. You will need to consider whether the person:
- has the ability to do the job;
- is willing to act;
- is likely to outlive you; and
- is impartial enough to perform the duties of the office of executor.
You will need to consider appointing a back-up executor should your preferred executor be unable to act or predeceases you.
5. What is Probate?
Probate literally means ‘the proving of the will’ in the Supreme Court of NSW.
The court will consider the application for a grant of probate by the executor. If all is in order, the court will decide that the will is the proof of your intentions.
When probate has been granted to the executor, the executor is then able to deal with your assets and to carry into effect the provisions of your will.
6. What are Letters of Administration?
The Supreme Court of NSW may appoint an administrator to an estate where a person dies:
- intestate (dying without leaving a will);
- leaving a will, but without having appointed an executor; or
- leaving a will and having appointed an executor, but the executor is not willing or capable to apply for Probate.
8. What are the issues that an executor or administrator needs to consider in respect of the administration of the estate?
- Any debts, including funeral expenses
- All the assets and property covered in the will
- Any tax matters, including preparing and lodging a tax return.
- Publish a notice of intended distribution and distribute the estate when it is safe to do so.
9. What is a Power of Attorney?
This is a legal document where you appoint a person, known as the attorney, to do things on your behalf, such as making financial and legal decisions. This can involve managing your money, shares, real estate and any other assets you have.
This is an important document to have in place in the circumstances where you may be later incapable of making your own financial and legal decisions. Alternatively, you may be capable but you may be based overseas or interstate and require certain things to be done on your behalf. Your attorney will then step in on your behalf to make your own financial and legal decisions.
It is important you appoint a person(s) who you absolutely trust to look after your affairs. The Attorney has strict duties if he or she accepts the appointment, such as, he or she must:
- always act in your best interests
- keep their money and property separate from yours
- keep reasonable accounts and records of your money and property
- act honestly
- acknowledge that he or she cannot gain a benefit from being an attorney.
10. What is Appointment of Enduring Guardian?
A guardian is a person you appoint to make personal decisions on your behalf such as where you should live and what medical treatment and services you should receive.
The guardian will only be able to step in to make decisions on your behalf if you are incapable of making your own decisions, as a result of a stroke, accident or dementia. Until that occurs, you are free to make your own decisions as you see fit.
