“None of us are getting out of here alive, so please stop treating yourself like an after thought. Eat the delicious food. Walk in the sunshine. Jump in the ocean. Say the truth that you’re carrying in your heart like hidden treasure. Be silly. Be kind. Be weird. There’s no time for anything else.”
Nanea Hoffman, founder and CEO of Sweatpants and Coffee
The elephant in the room:
I know we don’t want to think about this and it seems easier to push this subject off to one side and many of us do. The terrible part about growing up is thinking about all these grown-up things. Quite understandably dying is not something that any of us want to dwell on.
Let’s start with some simple definitions:
- A ‘Will’ is a legal document with instructions for who will inherit the estate, care for any dependent children, and who would be the executor of the estate when whoever’s Will it is, passes away.
- ‘Estate’ refers to any money and property owned by a particular person.
- An ‘Executor’ is the person or organisation that’s been given the responsibility of managing the assets according to the directions in the ‘Will.‘
- ‘Probate’ of a Will is a legal process where the Supreme Court certifies that the deceased left a valid Will and the executor has the authority to finalise the estate.
Can’t find it:
Sometimes a Will can’t be found, so it’s usually presumed the deceased died ‘intestate’, which means ‘without a Will’.
Intestacy may occur not only when a person fails to make a Will but also for other reasons, such as:
• the Will fails to dispose of all their assets properly.
• the Will is invalid because it has not been signed or witnessed according to the law.
• the person did not have the mental capacity to make a Will.
• the Will has been poorly put together, and the legal rules of construction have not been followed.
Now and then, a person may die partly testate and partly intestate. This occurs where part of the Will is valid, but part is unfortunately invalid. This will potentially result in even more inconvenience, delays, and expenses than overseeing a full intestate estate.
Wills and estate laws are not uniform around Australia, so the states and territories are all individually responsible for making succession and inheritance laws.
When BBQ chats happen, it’s often assumed that your estate automatically passes on to the state or government. But the various national succession laws set out the order in which your eligible relatives Will inherit an estate. Only when people die without eligible relatives will the estate pass to the State.
This might sound like a bit of a basic declaration, but it’s always going to be better to make a Will, because that way you get to make your own decisions about your intentions on who is going to inherit your estate, rather than having the intestacy rules apply.
It’s up to you:
You can choose to benefit your favorite charity, a friend, or a remote relative who may not necessarily have been included under the intestacy rules.
In addition, you will save your family and loved ones a great deal of administrative work, anxiety, and pain if you have left a clear and concise Will rather than making them go through the process of establishing themselves as eligible relatives.
If the deceased owned any type of real estate solely and the Will is valid, then the executors can follow the simple process of disposal as per the requirements of the Will.
There are two types of ownership, ‘joint tenancy’ and ‘tenants in common’. These terms sound familiar but have different legal effects.
If the dearly departed owned property as a ‘joint tenant’ (typically, this is spouses), the property then passes automatically to the surviving tenant regardless of a Will or the intestacy rules. This joint property is not included as part of the deceased’s estate.
However, if the deceased has held property as a ‘tenant in common’ (that is if the property was co-owned through having a share in it), the share would pass to their beneficiaries as part of the estate.
I know you don’t want to think about this but talk to the experts:
The best way to ensure you have covered all bases is to get advice from a licensed legal or estate planning professional. I’ve always recommended when clients are buying or selling property, to have a conversation with their legal team about updating their own Will.
Knowledge is Power
Owun is the Senior Education Specialist at the Blue Wealth Property Academy and hosts The Clever Investor podcast. He has worked in finance and property for well over 20 years and is known for explaining the complex world of wealth creation in an easy-to-understand way.