Many years ago I went to the movies and enjoyed watching Dead Poets Society featuring the late Robin Williams. Whilst Robin Williams will long be remembered for his artistic talents, his estate planning arrangements have also become widely publicised not only for the considerable size of his estate but also for how it was constructed.
He created living trusts for his children to receive their share of his inheritance whilst he was alive and at different points in time rather than via his estate. Whether this was a wise decision or not depends on his family and taxation circumstances. It does appear that Robin Williams did have an estate planning strategy.
‘Robin Williams’ estate planning strategy is in direct contrast to the apparent lack of estate planning by the late Michael Hutchence. Michael’s only child Tiger Lily has reportedly received nothing from her father’s estate. It seems as though the majority of Michael Hutchence’s estate was not owned by him at the date of death – but in trusts which in he was in control of.
Whilst the lives of celebrities are far removed from our everyday lives, the basics of estate planning are common. In my recent blog – Live Your Legacy – I recommended starting your estate planning process by examining your family values.
Where do you want your money to go if you die?
This is frequently poorly done even though it is a logical place to start. Rather than focusing on what needs to be done to get your estate planning in order, it is best to start with asking why you need to do it. Everyone’s values and objectives are different.
How would your assets be distributed if you died yesterday?
It is a common misunderstanding that all your assets will be distributed via your will when you die. It is worthwhile reviewing all your assets, superannuation funds, insurance policies, insurance bonds, family trusts and share and property investments, to see how they are owned, your beneficiary nominations and who controls your family trusts.It seems to be in the case of Michael Hutchence, very little was owned by him personally and his wealth was controlled by trusts that did but not form part of his estate. Property that is jointly owned also does not form part of your estate when you pass away, automatically passing to the joint tenant.
Choose the correct beneficiary nominations
A common cause of estate planning disputes is regarding superannuation beneficiary nominations. In my blog post – Estate Planning for superannuation death benefits – I highlight the importance of reviewing who you have nominated to receive your superannuation death benefits.
Protect your children
Appoint someone of your choice to act as the legal guardian for your children.
Use appropriate estate planning strategies
What are the best strategies to achieve your objectives? These strategies should include minimising tax, protecting your capital for future generations and providing a succession plan for your business interests. They should be unique to you and only be considered after you have addressed the “why” of your estate planning requirements as they range in complexity and cost.
Make sure you “seize the day” and review your estate plan.
Please contact us on 0499976058 if you would like assistance in reviewing your estate planning arrangements.
Disclaimers & Disclosures
Geoff Ivanac is Sub-Authorised Representative No. 000309751 of GPS Wealth Ltd (GPS) ABN 17 005 482 726 Australian Financial Services Licence (No 254 544) and can provide the following services financial planning, risk management, managed investments, superannuation and retirement planning, margin lending and self-managed superannuation funds.
The information provided on this website has been provided as general advice only. We have not considered your financial circumstances, needs or objectives and you should seek the assistance of your GPS Wealth Ltd (GPS) Adviser before you make any decision regarding any products mentioned in this communication. Whilst all care has been taken in the preparation of this material, no warranty is given in respect of the information provided and accordingly neither GPS nor its related entities, employees or agents shall be liable on any ground whatsoever with respect to decisions or actions taken as a result of you acting upon such information.