Estate planning gives you peace of mind that your affairs will be in order if you die unexpectedly or become unable to manage your affairs. The structure of an estate plan will vary according to your personal circumstances, but every estate plan has the same goal – to ensure your accumulated assets are managed and transferred according to your wishes in the most financially efficient and tax-effective way.
There is however a common misconception about estate planning – that’s just about getting a Will drawn up. There is far more to estate planning than just having a Will.
A Will is certainly an important component of the estate planning process – but there’s a lot more to it than that. That’s because there are a number of complex issues that a typical Will does not normally address. For instance, on its own, a Will:
With that said, having a Will, is better than not having one because various States have different laws on how assets are to be distributed if you die without a Will (intestate). However, given the highly litigious society we live in, having a Will does not guarantee much certainty either. In fact, there are many cases where the courts have overridden the wishes of the deceased. This can happen when a grieving child, spouse or other person feels they were mistreated in your Will especially when they did not receive what they thought was due to them.
Estate planning then, requires an in-depth and holistic review of your life’s circumstances, from multiple perspectives (e.g. tax, legal, asset protection etc.) that takes into account all the factors and risks associated in bequesting your assets.
For instance, there are significant tax implications as well as asset protection risks that need to be addressed in addition to having a legally binding document.
The most important estate planning issues that you need to consider are:
Therefore, estate planning is more than just about having an up to date Will – it requires a comprehensive strategy to ensure that all bases are covered for a smooth transfer and preservation of wealth to the right people, in the right way, as cost-effectively as possible, with the least amount of hassle.
An Estate Planning Strategy from Chan & Naylor can help you get the right assets, to the right people (safely) at the right time, and in a tax effective way…
Our financial advisers and specialist accounting & structures team can work closely with their Legal advisers on your behalf, to formulate an effective estate planning framework and strategy to ensure that your ‘final wishes’, do indeed come true.
Chan & Naylor has the resources and expertise to provide a single point of contact for your estate planning needs. Contact our Wealth Planning team to discuss your estate planning and estate management requirements.
How you transfer your assets is just as important, if not more important, than identifying who your beneficiaries are in a Will. If the ‘How’ is not addressed, then there will be significant exposure to loss of assets and high taxes.
It’s important to understand that the typical Will leaves assets to specific people e.g. spouse and children. Normally people pass on their assets via a Will but the will does not protect your assets. It only says that the assets should go to someone if they are there at the time of the owner’s death. Therefore if you are successfully sued before you die and you lose your assets the will is meaningless as there are no assets to pass on.
The problems arising when the assets pass to that person directly is that it leaves them vulnerable to attack in bankruptcy situations, family law court hearings and the problem of minor’s tax. This is where children under 18 are taxed at rates between 66% and 45% (plus Medicare Levy) on unearned income. There are also significant tax trigger events such as Capital Gains Tax or Stamp Duty in how assets are traditionally transferred on bequest via a Will (i.e. assets such as a family home held in your personal name, transferred to another person’s individual name).
For certain clients (who are seriously concerned about getting sued, thereby requiring asset protection), Chan & Naylor suggests they consider using the Family Estate Agreement™. It’s a three part-process that creates a legally binding obligation to move ownership of your assets on death to a specially designed family lineage trust (that ensures that only blood relations can have beneficial ownership of the assets – not the in-laws!).
It’s important to consult with a team of experts to help you formulate your estate planning strategy, including specialist accountants, financial advisers and legal advisers.
Chan & Naylor is uniquely positioned to provide you with a single point of contact for estate management via your Client Manager and Wealth Planning family office. Contact us to learn more or talk to one of our advisers today. Our financial advisers and specialist accountants work with some of the best legal services on your behalf, to help you develop a robust estate plan that could:
At Chan & Naylor, our aim is to care for you, your family and business from generation to generation. We believe that estate planning should be an efficient and effective inter-generational wealth transfer solution – one that also provides for your required lifestyle and enjoyment ambitions while you are alive as well as long after you’ve passed away.
Speak with one of our specialist advisers to discuss a reliable plan to take care of your family.
In this compilation package, Chan & Naylor highlights the importance of having the right investment structures and agreements for estate planning, and how typical Wills potentially fails to provide a safe and tax effective transfer of inter-generational wealth...
Chan & Naylor Australia Financial Planning Operating Pty Ltd ABN 32 646 221 079 [t/a Chan & Naylor Financial Planning] is a multidisciplinary business that provides a number of services including Financial, Tax- Accounting, Business and National Property Advice. Chan & Naylor Australia Financial Planning Operating Pty Ltd ABN 32 646 221079 [t/a Chan & Naylor Financial Planning] is only authorised by lnfocus Securities Australia Pty Ltd [ABN 47 097 797 049) AFSL and Australian Credit Licence No. 236523 to provide Financial Services only.