The presents have gone from beneath the tree, the over-full rubbish bin has been emptied and the last of the ham and turkey has finally disappeared from the fridge.
Now is the time when we start to reflect upon those New Year Resolutions we traditionally make early each year.
Estate planning is one of many legal issues facing lesbian and gay couples. Increasing numbers of LGBT parents are raising children.
In the law, there are recognised categories of parenthood, including biological (genetic), gestational, surrogate, and social.
Children raised by same-sex parents may be the product of adoption, artificial insemination, surrogate birth, or biological parenthood, yet in most cases only one partner is recognised as the legal parent, with the other parent remaining a legal stranger to the child.
The phrase “nuclear family” has traditionally referred to a married heterosexual couple raising their own biological children. Nowadays, more children are living in non-traditional families than ever before. This can lead to tricky legal issues if the couple ends their relationship and the non–legally recognised parent tries to maintain contact with the child.
Senior lawyer specialising in estate planning and Wills in Adelaide.
Rod Genders from Genders and Partners, the oldest law firm in South Australia, says that state law does not permit animals to be direct beneficiaries of a Will, as the law regards the animals themselves as property.
However, caring pet owners can leave money for their pets in pet trusts with provisions for how it is to be spent on the pet.
As our population ages and fewer couples have children, there has been an attitude shift where many people have come to view their animals less as pets and more as members of the family.
Many people mistakenly believe that having a simple legal Will covers all their needs, yet it’s only one piece of the legal protection puzzle. Without proper estate planning, you’re leaving your wealth and assets quite vulnerable and unprotected.
In some circumstances, it can mean the difference between having your wealth distributed the way you want, or having it given to those you don’t want anything to do with anymore. Or it may even be the difference between losing your home and keeping it, when unexpected events arise, like an accident that leaves you alive but incapacitated.
Even if you have a legal Will, that’s only one piece of the puzzle to protect you, your family and your assets. Without an integrated and up-to-date estate plan, you are gambling with your future.
As a parent, what is our worst fear?
For most of us, it would be receiving that phone call telling us that our child is having a medical emergency. It might be a car accident, or some other health crisis, but as soon as we are notified we want to rush into action to help them. No matter how old they are, they will always be our child, even if they are now an adult.
It used to be that when a child turned 21, he would receive a key to the front-door of the family home, in a rite-of-passage symbolising and acknowledging their transition from child to adult.
With the faster pace of life, and changing societal expectations, the legal age-of-majority is now18.
Did you know that if your children are aged 18 or older, even if they are still living at home with you, then you are no longer able to make their medical decisions for them? In fact, you have no right to speak with their doctor or nurses or see their medical records.
Discretionary trusts are flexible estate planning tools that can offer you many advantages, some of which include:
1. Revocable. Because the needs of family members may change over time, a discretionary trust normally allows you to modify trust provisions or change the beneficiaries.
2. Private. A discretionary trust may avoid or reduce the costs and delays of Probate – which is the Court process that oversees the administration of your estate. Because a discretionary trust is not subject to public scrutiny, your beneficiaries and the specific amounts or percentages they receive remain confidential.
3. Continuous. Assets put in a discretionary trust stay under the control of the trustee, until you choose differently. When the trust is established, you can name a successor trustee who will carry on financial responsibilities in the event of your incapacity or death.
4. Flexible. You may add other assets to the trust during your life. The discretionary trust can be especially useful if you own real estate in another state by eliminating the need to have a separate probate proceeding in the other state.
New and young parents often mistakenly consider that have too few assets to bother with creating an estate plan.
They probably have a home with just a small amount of equity, and hopefully they have decent jobs, and reasonable prospects for advancement.
Most of us have superannuation, and many super funds carry life insurance. In dollar terms, it is not uncommon for young people to be worth more dead than alive.
When considering estate planning they should think about naming a guardian for their children and to make sure their money goes to the kids.
Most people grossly underestimate the money it will take to raise their young children and educate them. They frequently only have a small fraction of the life insurance that is needed. Fortunately, term insurance is relatively inexpensive for young people.
They should consider establishing a Trust to receive the insurance and other assets. This can be done through a Testamentary Trust created in their Will, or as a Discretionary Trust.
A trust provides some asset protection, and professional management for the funds.
Of all the countries in the world, Australia ranks in the top 5 with longest lifespans (17 places ahead of the UK and 33 places ahead of the USA). Each year, our average life expectancy continues to increase.
And yet, more than half of adult Australians do not have a legal Will, and even fewer have an integrated estate plan.
Life used to be simpler. People worked for the same employer for their entire career. They had government-guaranteed pensions. Medical expenses were manageable. Divorce was rare and remarriages rarer still. 25 years ago, when my legal career began, I can clearly recall the expression “broken home” being used as an excuse for various misconduct. Most people were not invested in the stock market.
But, the trade-off was that although life was simpler, it was also significantly shorter. Retirement didn’t last long, so people didn’t worry as much about having sufficient savings to last a lifetime. Long periods of incapacity were unusual. You worked, then you died.
When the Australian Government began the aged pension in the 1920’s, they set the age-of-eligibility at 65 for men. At that time, the average life expectancy for men was only 63, so the Government did not expect to have to pay out much for the pension, nor medical treatment, aged care or publically assisted accommodation.
