Wills & Estate Lawyers come across many common myths and incorrect assumptions about Wills. Relying on these mistaken beliefs can have serious financial and emotional consequences for your Estate and your family members following your death.
Myth #1 – “If I die everything will automatically pass to my husband/wife or partner”.
This is not always the case.If you die without a Will, you are considered to be intestate. The Queensland intestacy laws contain a set of rules for the distribution of assets where people have died without a valid Will. Under those rules, your spouse will receive a portion of your Estate. However, they may not receive all of your Estate depending on the size of your Estate and the other family members you leave behind. Further a partner may not be considered a spouse for legal purposes such as distribution of your Estate on intestacy.
Although the intestacy rules recognise the importance of providing for your spouse, the provision your spouse actually receives may not be adequate for his or her needs. In those circumstances your spouse may be forced to bring a claim on your Estate resulting in costly litigation and an enormous emotional burden for your spouse and your family.
By making a Will now, you can ensure your spouse or partner is adequately provided for and prevent your assets passing to those you do not intend to benefit from your Estate.
Myth # 2 – “If I don’t make a Will, my Estate will go to the State or the Public Trustee.”
This is a common misconception and although it is not completely untrue, the chance of this occurring is extremely low.
If you die without leaving a valid Will your Estate will be distributed in accordance with the Queensland intestacy rules. Generally your spouse and your children will inherit, but it can get quite complicated especially when there are current and former spouses and blended families involved.
In the event you that you are not survived by any spouse, child, parent or next of kin, the Estate is deemed to be bona vacantia and the State is entitled to it. This will only occur after a thorough search has been carried out to determine there are no living relatives who may be entitled to your Estate.
Myth #3 – “I don’t have any assets so I don’t need to make a Will”.
The Estate of a deceased person needs to be dealt with, regardless of whether there are many assets or not, and regardless of whether there is a Will or not.
Even if you think your Estate is not worth a lot, it is still important to make a Will. The administration of your Estate will be simpler, quicker and less expensive if you have made a Will.
Further, your Estate might be worth more than you think. Many people have personal possessions and superannuation. Superannuation may form part of your Estate and by law will require distribution.
Additionally, if a person dies accidentally there may be substantial compensation that falls into the Estate for distribution. Small Estates can be unnecessarily complicated if you have not made a Will.
Myth #4 – “I can write my own Will using a Will-kit an online template”.
Can an informal document be a Will? read more Making a homemade Will can be disastrous for your Estate and your family.
It is our experience that homemade Wills, do-it-yourself Will Kits, and online template Wills cause more problems than they are worth. It is very common for people to complete the Will Kit forms or online templates incorrectly or fail to have it signed and witnessed correctly.
This can result in a purported Will being challenged in court if the drafting is not clear or if there is any uncertainty about the meaning or interpretation of your words.
While leaving behind a note or homemade will might outline what you would like to happen, this type of document may not be legally effective.
The costs to have the Court determine if an informal document is your last Will and/or to interpret what the document means will be substantially greater than the up-front cost of seeing an experienced solicitor to prepare your Will.
It will also cause additional uncertainty, stress and delay for your family members following your death.
Myth #5 – “If I leave my child a nominal gift (eg $1) in my Will, they won’t be able to bring a claim on my Estate.”
This is not true. Leaving an estranged child a small or nominal gift will not protect your Estate from a claim. In fact, it might have the effect of upsetting the person you wish to disinherit and actually cause them to bring a claim on your Estate.
One of the significant factors in considering whether adequate provision has been made for a child or spouse is the needs and financial position of that person. A nominal sum obviously does not take into account those issues at all.
Related Myth #6 – “I can make a Will that no one can challenge or change”
In Queensland the spouse, child or dependents of a deceased person have a statutory right to make a claim on the Estate if adequately provision has not been made for their proper maintenance and support. For more information on this topic please see our guide “Have you been left out of a Will”. It is not possible to make a Will that no one can challenge or change. There is no certain way to guarantee that a claim will not be made.
Our experienced solicitors can give you advice on some of the steps you can take to reduce the risk that a person will make a claim on your Estate. These steps may include keeping assets out of the Estate and therefore beyond the reach of a claim (for example, through joint ownership, binding nominations on superannuation or trust structures). Such steps may have undesirable asset protection, tax and stamp duty risks so need to be carefully considered.
Myth #7 – “I cannot make a gift to the person I nominate as executor”
This is not true. It is very common to appoint your spouse as your executor and to leave your whole Estate to your spouse.
On a separate but related note, your executor is entitled to claim a commission from your Estate for performing the role of executor. To claim commission the executor must obtain the Court’s permission. It is common for the Court to allow commission in the range of 1.5% – 3% of the Estate, depending on the size and complexity of the Estate and the time and skill involved in its administration.
To avoid the cost of obtaining the Court’s permission, an executor will sometimes obtain the consent of each of the beneficiary’s to the commission to be paid.
If you do choose to leave a gift to your executor, it is important that your Will is clearly drafted to express if that gift is conditional upon that person performing the role of executor and if that gift is in substitution for any rights the person would have to claim executor’s commission.
It is best to appoint an adult family member whom you trust and consider reasonable and sensible as your executor. If you do not have a trusted family member or friend to perform the role of executor, you can consider appointing the Public Trustee or a solicitor from our firm to be your executor in their professional capacity. If you appoint a professional executor your Estate will have to pay for the professional services of that person to administer your Estate. Given that an executor who is a family member will generally not be paid nor claim commission it is far preferable to appoint a family member where possible.
Myth #8 – “I can use my will to make a gift of my superannuation benefits”.
Your Will disposes of all assets you own at the date of your death. If you have funds held in a superannuation account, technically those funds are held by the Trustee of the Superannuation Fund, for your benefit. You do not yet own them and they will not automatically form part of your Estate.
Given that superannuation often represents a significant part of your net wealth, and that you may have substantial sums in death benefits connected to your superannuation, it is critically important to understand how your superannuation will be dealt with on your death.
For more information on how your superannuation will be dealt with following your death please see our guide “Superannuation: Your Biggest Asset”
Myth #9 – “I can make a gift in my will of assets held by a family trust because I am the trustee of that Trust”.
If you are a trustee of a family trust or a unit trust or a self-managed superannuation fund, you should obtain specialised Estate planning advice about what will happen to the trust and the assets owned by the trust following your death.
In your Will it may be possible to appoint a person who will take on the role of trustee from you on your death. This allows you to pass the day to day control of the trust to another person. However, since you do not personally own any of the assets of the trust, you cannot use your Will to give away or deal with any of the assets owned by the Trust. Only the Trustee can make distributions from the Trust in accordance with the Trust Deed.
At the time of making your Will, the terms of the original Trust Deed (and any amendments to that Deed) will need to be consulted to consider the beneficiaries, the clauses regarding death of a trustee, and any powers of appointment of trustees, appointors or principals, to ensure that you have an effective plan regarding the control and beneficial interests of the assets of the trust following your death.
Myth #10 – “I can keep my will confidential after my death and tell my executor not to show it to anyone else”.
Following your death your Executor is entitled to all of your property, including all of your documents.This includes your original Will, which will not be provided to any person other than the Executor you have nominated in your Will, following proof of their identity and proof of your death.
Section 33Z of the Succession Act 1981 (Qld) provides that a number of other people are entitled to obtain a copy of your Will, including:
- A person mentioned in the will;
- A person mentioned in any earlier will of the deceased;
- A spouse, parent or child of the deceased;
- A person entitled to a share of the Estate if the person had died intestate
- A creditor of the Estate;
- A person entitled to bring a family provisions application against the Estate.
Even if you have instructed your Executor not to show your Will to anyone else, or not to your Will to a specific person or persons, if one of the people listed in s33Z requests a copy, they are entitled to it and your Executor will have to provide them with a copy.