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Protecting our loved ones is something we all care about, but when it comes to financial security, your family may not be as safe as you think. Dismissing the importance of making a will is something can often end up leading to heartache.
What is a Will?
A Will is defined as a legal document that indicates how a person wants their finances, property and possessions to be distributed after their death. With that in mind, it’s easy to assume a Will is all that’s needed to ensure your estate is divided up exactly as you want.
However, what’s not always covered under a Will is superannuation – the account where many Australian’s hold the majority of their savings. As we’ve seen in the news recently, things can take a seriously wrong turn when superannuation isn’t taken into account.
Wills and Estates: What can happen?
Daniel Laverton was a dedicated Royal Australian Air Force mechanic who passed away unexpectedly at just 40 years old, tragically leaving behind two young daughters aged 7 and 9.
Like many, Laverton had built up a healthy amount of retirement savings and life insurance in his superannuation fund. So, after years of service paired with the fact that he chose to keep his ex-partner and mother of his children the executor of the will and sole beneficiary of his Will even after their separation, Laverton’s family was confident that his girls would be looked after.
To their disbelief, a woman who Laverton had been living with in a relatively new defacto relationship won a claim with Military Super and was awarded three-quarters of the soldier’s estate – despite no mention of the woman in his Will.
Can this happen to me?
Daniel Laverton believed he had his ducks in a row. He had taken steps he believed would ensure the financial future of his children, and kept his ex-partner listed as the sole beneficiary because he knew that all of the money would be put towards their upbringing.
The fact that this could happen to him, even with a legally binding Will in place, highlights that it really can happen to anyone who doesn’t have a sound understanding of the relevant legislation when it comes to wills and estates – or advice from someone who does.
How Can You Avoid Someone Contesting A Will?
Firstly, it’s imperative that you have a clear and up to date Will. Secondly, you need to contact your superannuation fund to make a binding nomination of a beneficiary.
A binding nomination means that the superannuation trustee must distribute your funds exactly as you have requested. Most superannuation funds will require you to list these requests in writing and renew them every three years.
Tread with caution when it comes to non-binding nominations, as these are only considered “preferred” beneficiaries. This means that ultimately the trustees will still make the final decision.
Let’s Create A Will!
Life is full of surprises, and we won’t be around forever. If you’re wondering how to make a will or find out more information on how you can protect the financial future of your family, get in touch with one of Rising Tide’s friendly financial advisers by calling 03 9600 2124 today.