Without a valid Will your family and loved ones may suffer unnecessary delays or expense in settling your affairs after your death.
If you are over the age of 18, you are able to (and should) make a will. The consequences of not having a valid Will are that your estate (i.e. your ‘stuff”) will be distributed in accordance with legislation. This may result in those you care about missing out on the things you wanted them to have or getting a smaller share of your estate than you would have liked. This certainly means that a lot more money gets spent administering your estate than if you had a valid Will. In other words money that should have gone to your family will be used up in extra legal fees.
If you already have a will, you should consider updating your will if your personal or financial circumstances change. Having children, getting marriage, getting divorced and being into a de facto relationship are all reasons for updating your will.
Did you know that if you get married your current will becomes void? Unless your will is made in contemplation of marriage then at the point you say “I do”, then you have no valid Will. Interestingly enough, however, divorce does not invalidate a Will.
Young people often make the mistake of saying “I don’t have any assets anyway so I won’t worry about making a will”. Have you recently assessed your financial worth considering your life insurance and Kiwi Saver funds? Your net worth might be much more than you think.
Are you in a Kiwi Saver programme? You will need to have either a valid Will to get access to your money on your death or have your family apply for Letters of Administration on your death. Letters of Administration cost your family time and money.
What about your children? In order to make sure your wishes are followed about who look your children on your death, you should specify who you wish to look after your children in your Will. This itself is a reason for all parents to make a will.
Enduring Power of Attorney
One of the best insurance policies you can take out to maintain your personal wealth position during your lifetime is an Enduring Power of Attorney. This document appoints a trusted person in your life (or a Trustee Corporation) to look after your affairs (Property and Personal Care and Welfare) in the event that you are not able to look after them yourself.
I recommend that everyone should have a Will and Enduring Powers of Attorney. These documents can be all part of an estate plan that may include a Family Trust.
