Estate planning is the process of documenting a person’s wishes for the distribution of his or her assets owned at the time of death and the most important document for this purpose in the Will.
Estate assets are dealt with in the Will and these assets are those owned in the personal name of the will-maker. They may include real property and interests in assets held as tenants in common, personal effects, shares and cash investments.
Non-estate assets which are not disposed of by a Will may include superannuation, life insurance proceeds and account-based pensions or annuities that have a reversionary beneficiary. Jointly owned assets such as real estate and investments are also regarded as non-estate assets.
The Will states who will be in charge of the administration of the estate and how the assets of the estate are to be distributed after death. The usual requirements for the preparation of a valid Will include the following:
the will-maker must be over the age of 18 years
the Will must be in writing and signed by the will-maker
the will-maker’s signature must be witnessed by two independent witnesses who were present at the time of signing the Will
the will-maker must possess the necessary testamentary capacity to make a Will
Where the Will does not satisfy all legal requirements it may be deemed as invalid. In this case or if no Will exists, the person is said to have died intestate and the estate will be distributed by a court appointed administrator in accordance with the relevant intestacy laws. This can incur unnecessary costs and delays.
Marriage should be reason to review a person’s estate planning needs. As a general rule, marriage revokes a Will unless the Will is made in contemplation of that marriage.
The impact of divorce upon the validity of a Will varies between jurisdictions and in some cases does not alter a beneficiary’s entitlement under a Will. It is therefore wise for a person who has separated from a spouse to review their Will.