A Deceased Estate comes into existence when a person dies. Such an Estate must then be administered and distributed in terms of the Deceased’s Will.
In the absence of a valid Will, Deceased Estates leave family members with the added emotional and financial burden of having to deal with uncertainty and hardship caused by delays in managing the Estates and additional expenses.
If you die “intestate” (without a Will), some of the challenges:
- A suitable Administrator must be appointed by the Supreme Court of NSW. This may not be the person you would have chosen if a valid will was made (executor)
- The Administrator has to establish a family tree using certificate evidence – this can be expensive and time consuming especially if family members were born or live overseas.
- If the next of kin is a child, who is less than 18 years old, or suffers incapacity, or there are other special circumstances, the Administrator must provide a bond to Court, usually to the value of the estate.
- Assets are distributed to a statistical formula with certain family members receiving a deferent percentage of your assets. (click here )
- Only if there are no relative does all the estate go to the Crown.
The net results are:
- That dying without a valid Will is a lot more costly than if you have a will.
- You lose the ability to influence how your assets will be distributed.
- You lose the ability to provide for estate planning, especially if there are income producing assets. Your estate and beneficiates may end up paying more fees than would otherwise be the case with a well-planned will.
- If a business is involved, there is no scope for succession planning.
When a person dies without a Will, it is the loved ones who are left to deal with the mess which is a sad legacy to leave behind which can be avoided. Having a Will offers many benefits and will ensure that the Deceased person’s wealth is managed and distributed as per his or her wish. A selected Executor is appointed to manage and control the Deceased Estate’s wealth.
In circumstance where there is an out of date Will, it can result in the wealth ending up in wrong hands. It is therefore very important to update Wills as financial circumstances change. A review commonly results in no change, but on the rare instances a change will be required and will avoid potential problems.