Estate Planning Essentials For Young Families

When raising a young family, estate planning is often not top of mind... but it is one of the most important steps you can take to protect your loved ones.

Life is unpredictable, and having the right legal documents in place ensures that your children, partner, and assets are looked after if something unexpected happens.

We work with young families throughout Queensland, from all walks of life, to create simple and effective estate plans that provide peace of mind.

Why Estate Planning Matters For Young Families

You may think estate planning is only for the elderly or the wealthy, but the truth is that it’s crucial for all adults, and even more so for anyone with children and/or dependents.

If you and your partner were suddenly unable to care for your children, who would take on that parental role? Would your family know your wishes? How would your assets be managed?

Without a valid Will and supporting documents, these decisions are often left to the courts, and the outcomes may not align with any wishes you may have had.

Key Components Of An Estate Plan

Here are the essentials every young family should consider:

1. A Legally Valid Will

Your Will outlines how your assets are to be distributed upon your death. Wills can be simple or complex, and may include provisions regarding specific assets or individuals.

Without a Will, the court decides who will receive the benefit of your estate. To learn more, read our recent article here.

2. Testamentary Guardianship

In your Will, you can formally nominate a testamentary guardian/s. This is the individual/s you want to look after your children if both parents pass away.

This is one of the most important decisions young parents can make. Your nomination carries significant weight, and will almost always be respected unless there is a compelling reason not to presented to the courts.

Choosing a testamentary guardian involves considering values, parenting approach, location, lifestyle, and capacity. It's also important to have a conversation with the nominated guardian beforehand to ensure they're willing and prepared for the responsibility.

3. Enduring Power Of Attorney (EPOA)

An EPOA allows you to appoint an individual (or several) you trust to make decisions on your behalf if you become incapacitated. This can include personal and/or financial matters, health care, and property decisions.

6. Advance Health Directive (AHD)

An AHD sets out your wishes regarding medical treatment if you're unable to communicate due to incapacity. Whilst not essential for everyone, an Advance Health Directive is worth considering if you hold strong personal and religious views regarding medical care or specific health concerns.

4. Superannuation & Life Insurance Nominations

Your superannuation doesn’t automatically pass through your Will. That is why it is important to make a binding death benefit nomination now to ensure your hard-earned superannuation and any associated life insurance goes to the right people.

At RHC, we can assist in the preparation and execution of these documents during an estate planning consultation.

5. Testamentary Trusts (Optional)

If your children are young, a testamentary trust can help manage their inheritance until they reach a suitable age if required.

Testamentary trusts are a type of discretionary trust established in a Will that allows the trustee to decide which of the nominated beneficiaries may receive the benefit of the distributions from that trust for any given period. For a more thorough breakdown of these valuable documents, we recommend our in-depth article here.

Testamentary trusts offer maximum flexibility by enabling the tax-effective distribution of both capital and income from estate assets. They also provide a higher level of asset protection compared to holding the assets directly in the beneficiaries' personal names.

Common Misconceptions About Estate Planning

Many young families delay estate planning because of misunderstandings or assumptions. Here are some of the most common myths our lawyers encounter:

“We don’t have enough assets to worry about.”

Even if you don’t own property or have large investments, you likely have more to protect than you realise. This may include superannuation, life insurance, cars and other vehicles, bank-held savings, and sentimental belongings.

It's important to remember that whilst a Will expresses your wishes, it is ultimately a document that benefits other people, as it saves time and money in the distribution of whatever assets you may hold, and provide security to your loved ones.

“We’re still young and healthy - We’ll do it later.”

No one expects to become ill or injured, particularly at a young age. The reality is that life can change in an instant. Estate planning gives you control now, and ensures your children aren’t left vulnerable or caught in legal disputed or court orders after you're gone.

“My spouse will automatically get everything.”

Simply put: not always.

If you die without a Will (known as dying intestate), Queensland’s laws of intestacy apply. This may result in your assets being divided between your spouse and children in a way you didn’t intend, and can create unnecessary complexity or legal disputes.

“We’ve already spoken to our preferred guardian - We don't need a Will.”

Only a properly drafted Will has legal standing. An informal note or verbal wish may not hold up in court, and could be disregarded entirely.

A valid Will is the only way to ensure your wishes are known, stated and enforceable.

Let Us Help You Get Started

At RHC Solicitors, we aim to simplify estate planning and ensure eyou understand your optiosn, and provide advice to achieve the right result for your unique circumstances. Whether you're welcoming your first child or managing a growing family, now is the time to plan for the future.

Ready to protect your family? Contact us today to schedule an estate planning consultation.

BOOK AN APPOINTMENT

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Disclaimer: This publication is not intended to be comprehensive, nor does it constitute legal advice. We are unable to ensure the information is current and there is no guarantee in relation to accuracy. You should seek legal or other professional advice before acting or relying on any of the content of this publication. The views and/or opinions expressed in this publication is that of the author and may not necessarily represent the views and/or opinions of RHC Solicitors.

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