Why you need a will and how a lawyer can help you
What is a will?
A will is a document that directs what happens to your assets after you die. There are technical requirements for the document to be recognised by the Supreme Court as a valid will.
Some assets may not be able to be dealt with by your will, such as assets you hold with other people, superannuation, interests in family companies or trusts.
A solicitor can help you put in place a will and a plan to deal these other assets & interests.
What happens if you don't have a valid will?
Without a valid will, your assets may be distributed under the law in a way which might cause hardship, delay & expense to your family. For example:
1. A married couple may have been separated for several years but not divorced. If one dies and there are no children, the surviving spouse receives all the estate.
2. A child’s parents may have separated when the child was very young and the mother may have raised the child without any real financial help from the father. The child becomes an adult and does financially well but dies without a spouse or children. The father is entitled to an equal share of the estate with the mother
despite having never helped to raise the child.
3. A young man works hard and buys a home. He marries but overlooks transferring the home into joint names with his wife. They have a child. When he dies without a will, the house is worth $500,000. Under intestacy laws, the widow receives $100,000 and one half of the balance of the estate. The other half of the balance (assume $200,000) has to be paid to Public Trustee on behalf of the child. The widow may have to sell the house or borrow the money to buy out the child’s interest.
How much does it cost?
The cost of the will depends on how simple or complicated you or your circumstances require it to be. Most lawyers may prepare a simple will alone for less than $500. At the other end of the scale, a wealthy person who decides to have complex testamentary trusts to deal with a wide range of property matters may pay much more. In the middle are people who need more than a simple will to deal with family trusts, companies or superannuation. It all depends on your circumstances and your wishes. Speak to the lawyer at the start of the appointment if you are unsure what you require, or the costs involved.
Why not just leave it to the family to sort out after I've died?
Where a person dies intestate, not only does the law determine who gets the estate, but a procedure has to be followed to obtain “Letters of Administration” from the Supreme Court Probate Registry. A detailed statement has to be provided to Public Trustee at the end of the estate distribution. This is more complicated and expensive that an ordinary application for “probate” (Court approval) of a valid will.
Why not use a Do It Yourself "Will Kit"?
A “will kit” assumes your circumstances are simple and this is not true for many people – second marriages and children from different relationships are a common example. If the technical requirements for completion of the will are not correctly followed, a Court application will be required and this is likely to cost thousands of dollars. Any mistakes you make will not become apparent until after you are dead, and the cost of fixing them will be much higher than getting it right in the first place. A lawyer’s advice when preparing your will can also reduce the risk of inheritance disputes which are very costly.
Why not use a public trustee or a trustee company offering "free" wills?
Public Trustee will prepare a will without charge, but only on the basis that Public Trustee is the executor and controls the procedure of applying for probate and dealing with estate assets. Public Trustee charges a percentage of the value of the estate assets in addition to Court fees and any legal costs. Typically, this will involve several thousand dollars of commission paid out of your estate. This would not be paid if a lawyer prepared a will that appointed one of your relatives or friends as your executor.
A trustee company may also charge a commission to act as executor which could cost your estate several thousand dollars compared with a lower cost for having a solicitor assist your relative or friend as executor.
When should I make a will?
Every person over the age of 18 years (who is not intellectually disabled) should have a will prepared. It is surprising how quickly many young people build up valuable assets after leaving school – a car, superannuation, bank savings, or a home. Traffic accidents and fatal illnesses are unpredictable. Even a simple will saves much expense and family stress in the event of a sudden death.
When should I review my will?
Changes in personal or financial circumstances mean you should seek advice when preparing or reviewing a will.
These circumstances include -
• marriage – which makes an earlier will invalid
• birth of a child
• buying a house
• divorce, or separation from a de facto partner
What happens to my superannuation?
For many people superannuation will be one of their most valuable assets. The interaction between superannuation and wills is complex, and superannuation does not automatically become an asset of your estate on death. You should seek legal advice about who is likely to benefit from superannuation on your death, and the possibility of having a “binding death nomination” to make certain it passes to the person you want.
How do I get a will?
The best way to get a will is to consult a lawyer who is experienced in preparing wills. Call the Law Society Legal Referral Service on (08) 8229 0200 or go to http://www.lawsocietysa.asn.au/LSSA/Community/Legal_Referral_Service_Portal.aspx to obtain the names of suitable lawyers in your area.