A will is one of the most critical documents that any person will complete in their lifetime. A will should never be regarded as a document set in stone. Changes in circumstances such as health, marriage, divorce, a new child or grandchild or the acquisition of valuable assets such as property may be reasons to have a new will prepared.
Lawyers who specialise in the preparation of wills often recommend that a new will should be prepared by each adult person every 5 to 10 years to take into account the changes in circumstances referred to in the previous paragraph.
A fundamental function of a will is to declare who will inherit a person’s assets upon death. Some people deliberately do not prepare a will because they cannot decide who should have their assets and accordingly, they allow the beneficiaries to argue for their share of the “cake”. Aside from the inevitable disruption to, or dissolution of family relationships built up over decades, the lawyers may be the ultimate “big winners” with little assets of the estate to distribute to beneficiaries after payment of legal fees.
Anyone who has been associated with the death of a person who has died without a will usually describe the process of going to Court to have an executor appointed – a person who may have no knowledge of the history of the family – is harrowing and may take months of legal argument. Meanwhile, the deceased’s assets are frozen or cannot be satisfactorily dealt with.
A will can also be a very tax effective document that can ensure that assets are transferred to beneficiaries without the imposition of capital gains tax. The income of a deceased person’s assets can be earned by minor children without being subject to penalty rates of tax.
Second and third marriages add complexity to the formulation of a will. Detailed consideration will be necessary to avoid the will being contested at a later time. One way of avoiding this occurring is to explain the terms of the will to affected family members. Consideration might be given to having a witness such as a lawyer or accountant being present when the will is explained; this may be useful in the event of a will contest.
Having your accountant jointly assist in the development of your will with your lawyer invariably results in a comprehensive document being prepared. After all, your accountant will have a detailed understanding of your financial affairs, business and investment structures.
Some people are often worried about the cost of having a will prepared. Your Nexia contact will always be happy to refer you to one or more competent lawyers who will meet your estate planning needs. A “high-powered” lawyer will not be necessary if your personal and business affairs are straightforward.