Estate planning can be used to create, protect and distribute wealth. Estate planning is beneficial for everyone regardless of the value of their assets, age, marital or family status. It looks at the person’s estate with complete consideration of assets and liabilities. To cover the most basic needs, everyone needs to have a valid will and power of attorney. This should be revised or reviewed every three years or after major life events such as divorce, marriage, birth of a child or grandchildren.
Estate planning is the logical extension of the process of financial planning. Putting your financial plan into place can help ensure your family’s financial security. A core benefit of estate planning is that it can help to reduce the stress for families at an already difficult and painful time. It can also be a tax efficient way of transferring assets.
The three core areas of estate planning are:
- Estate division – how you want your estate to be divided?
- Wills – making or modifying your will to convey your wishes
- Providing the financial means to make sure your wishes are carried out
A well compiled estate plan is more than just the making of a will, it for example, includes:
- Appointing a power of attorney
- Developing a family or discretionary trust to protect wealth
- Establishing a testamentary trust to minimise your family’s tax liability
- Selecting a trustee and/or executor to execute your will in accordance with your wishes