You are a child of the 80s and 90s – a product of the Generation Y era, just like me. You’re young, healthy,technologically savvy and enjoying the best years of your life. The topic of ‘estate planning’ is probably not on the top of your to-do list. Or perhaps it is, and you have filed the topic in your ‘too hard’ basket. But stop and think for a moment: what would happen to your assets, family and loved ones if you were to lose your mental capacity or pass away? Here are 5 reasons for you to look into your estate planning because in reality, we all have an estate regardless of our age!
Control of social media accounts, passwords and your digital estate:
Facebook, LinkedIn, Twitter, Instagram, Pinterest, email, debit cards and online membership subscriptions. You are likely to have an account with one or more of these online platforms and it is important that someone you know and trust is able to locate these details if they need to manage your affairs if you become incapacitated.You might not have traditional assets such as cash, shares or property investments, but have you ever considered the value of your ‘digital estate’? This is an often overlooked aspect of estate planning particularly relevant for Gen-Ys and comprises things like email,followers on social media (eg. Instagram),streaming subscription service accounts eg. iTunes library), and copyrights in photos, videos and music you have created,downloaded or purchased online. If you have died and appropriate steps have not been implemented before hand, then access to and use of the potential digital asset following your death may be frozen or lost.
Nominate someone to manage your financial and personal affairs if you lose capacity:
We like to think we are indestructible, but unfortunately things do go wrong. An Enduring Power of Attorney (EPOA) enables you to appoint someone (such as your parents, partner or close friend) as your attorney and that person will be responsible for looking after your finances and/or health and personal matters should you lose capacity. If you do not have an EPOA and you lose capacity, your family may have to apply to the Guardianship Tribunal to become your legal guardian, which can be time consuming, costly and emotionally draining.
Having a Will is not enough:
If you already have a Will in place, that’s an excellent start.However an effective estate plan includes more than a Will. Depending on your assets, a substantial part of your estate may not be subject to your Will and could be distributed in a very different way from what you expected. You need to consider, and get advice about whether jointly owned assets, business assets and superannuation are dealt with by your Will.
Don’t forget about superannuation entitlements:
Gen-Ys tend to think that they have little or no assets to worry about- but with guaranteed superannuation contributions and life insurance increasingly being offered as a default within superannuation, your death can often result in a significant payout to your estate. With most superannuation funds you are able to complete a Binding Death Benefit Nomination to elect a particular beneficiary of your death benefits. If you do not nominate anyone as beneficiary, the trustee of your superannuation fund has the discretion as to whom your death benefits are paid. Be careful though, as there are rules about who can be a beneficiary.
This is important for people of all ages however for all my fellow Gen-Ys out
there, the time to think about your estate planning is now. If you’d like to discuss this more, please contact Rehana Richard at DDCS Lawyers on (02) 6212 7600 or via email: [email protected].