News » What is Involved in the Estate Planning Process?

November 14, 2023

Estate planning: two simple words capable of carrying the weight of one’s entire lifetime and beyond.

But what exactly does this term entail? At its core, estate planning is the proactive process of organising our assets and affairs to ensure they are handled according to our wishes upon incapacity or death. While it might not be a particularly happy subject to broach, it is a critical, strategic blueprint outlining who will inherit your assets, how your affairs should be managed, and it ensures that your legacy is passed on in the most efficient and harmonious manner possible.

The plan itself is not simply a document or a transaction. With the right estate plan, you can secure your peace of mind, knowing that your worldly possessions will be administered as you intended, potentially reducing the emotional and financial burden on your loved ones during a time of grief.

To help you become more familiar with the process, John Bartle from Aspire2 Wealth Advisers has compiled some key points behind what estate planning is, who may need it, and why it is so important.

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Why is Estate Planning So Important?

After working hard to earn and accumulate assets throughout your life, the decision should rest with you on how they are distributed in the future. Rather than leaving that decision to an organisation, potentially leading to conflict and disagreements amongst your loved ones, an estate plan can make the transition as seamless and equitable as possible.

But what else is estate planning going to offer not only you but also those you care about most? Here are some of the most pivotal benefits:

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What is Involved in the Estate Planning Process?

1. Inventory your assets

Compile a comprehensive list of your assets, including tangible property like properties and precious metals, as well as any financial holdings such as bank accounts, insurance covers, and superannuation funds.

2. Catalogue your liabilities

Detail all obligations, spanning from personal loans to mortgages.

3. Detail your wishes

Determine who you wish to receive what from your estate. List specific items that you want to pass on to specific people (such as “my gold wedding band to my daughter, Jane”. Avoid specific amounts – specify percentage amounts of assets such as cash and shares rather than specific amounts. Things like cash account funds and share holdings can change over time.

4. Examine your superannuation funds

Check that your Superannuation Funds have binding death benefit nominations in place. Superannuation can sit outside your Will, so ensure that your nominations remain consistent with your wishes. Check to ensure that who you have nominated as your beneficiary meets the definitions of dependent under the Superannuation act.

5. Update your insurance and annuities

Ensure the designated beneficiaries on these policies are current and that all details are accurate.

6. Arrange joint accounts or ‘transfer on death’ provisions

With joint accounts having rights of survivorship, they bypass the probate process, transferring straight to the surviving account holder. ‘Transfer on death’ designations similarly allow for a smooth transition of account ownership outside of probate.

7. Select your estate administrator

Engage with a reliable person to posthumously manage your financial affairs. This is normally someone close to you, such as a partner or family member, or close personal acquaintance. If you do not have someone suitable within your network to undertake this role, you may need to seek out an appropriate external professional capable of assisting here.

8. Preparation of your will

Once you have a comprehensive overview of your financial situation, and have determined how you want your assets dealt with, it is recommended that you engage the services of a reputable lawyer to prepare your actual Will.

In essence, a properly constructed Will should map out your intentions, and resolve all financial ambiguities to ensure the appropriate distribution of assets.

9. Provide your executor with your will

Distribute copies to your chosen executor and keep another in a secure location to ensure your final wishes are acknowledged and accessible. You should also regularly update your assets & liabilities, and keep a list with copies of your will to make life easier for your Executor.

10. Don’t forget other important issues

Your will takes care of you after you pass away. Please don’t forget the following documents that you should have in place for you & your family in case you lose capacity prior to death. These include the following, and can vary from state to state within Australia:

Who needs estate planning?

A common and potentially detrimental mistake is thinking that estate planning is only needed for those nearing the end of their life. It is, in fact, a process built to help a broad spectrum of individuals, regardless of their wealth or status in life. These could include:

Consult with an Expert to Explore Your Options with Estate Planning Today

Click here to book a no-obligation consult.

Engaging with an estate or financial planner can help you to better evaluate your assets and create strategies for maximising your wealth potential. Speak with our specialists at Aspire2 Wealth Management today to get started.

This content contains information that is general in nature. It does not take into account the objectives, financial situation or needs of any particular person. You need to consider your financial situation and needs before making any decisions based on this information. If you decide to purchase or vary a financial product, your financial adviser (Aspire2 Wealth Advisers, 08 9322 7028), and other companies within the AMP Group may receive fees and other benefits. The fees will be a dollar amount and/or a percentage of either the premium you pay or the value of your investments. Please contact us if you want more information.