It is a common misconception that Will making is only for the elderly. It is important to remember that few of us know when our time may be up and it is paramount to prepare for the unexpected.
A Real Life Story*
This week we acted for a young couple who have three children aged 12, 8 and 6. They had been married for approximately 15 years and in that time built their wealth together. Their assets included the family home and two investment properties and, of course, superannuation.
Their main concern was that on the death of either one of them, that the survivor could remarry or re-partner. This raised a number of considerations including whether the new partner would have their own children or what would happen should that further relationship be unsuccessful.
Ultimately on death they wanted to ensure that the survivor would benefit the children of the relationship using the wealth they had created together, ensuring that these those monies would not be spent on step children or become the subject of family law proceedings.
A discretionary testamentary trust was recommended to the young couple who were taken by the idea. This was for the following reasons: –
- The funds accumulated together would not go to the survivor in their sole name but rather in a trust that they controlled;
- The surviving spouse would be a beneficiary of the trust along with the children of the relationship (there would be an exclusion of step children);
- The asset protective features of a testamentary trust include protection from creditors, bankruptcy and family law proceedings; and
- As their infant children would be beneficiaries of the trust, they would be treated as adult for tax purposes, potentially saving them significant amounts of tax.
This brought closure to the couple who now know that the assets they have accumulated together would benefit whom they intended, that being the surviving spouse and children of the relationship.
Should you wish to discuss testamentary trust wills please contact our office.
*Please note, personal details have been modified to protect the anonymity of our clients.