We have discussed intestacy before: this is where, if you die without a Will, your assets will be distributed according to a legislated formula in the jurisdiction where you live – regardless of your wishes.
In NSW a beneficiary of an intestate estate must survive the intestate by 30 days to receive a benefit from the intestate estate.
If you die intestate the estate is divided according to a formula between the spouse/s and children (this may include children of the intestate and current spouse/s as well as children of the ex-spouse or ex domestic partner)
Recently the husband of an elderly woman living in a small town died without a Will. The husband owned several small unimproved blocks of farming land and a small house/shop. The widow was receiving a pension of $321.00 per fortnight
Centrelink assess assets at their net market value therefore the house/shop has been valued at $250,000 and the blocks of land at $60,000. The widow has too many assets and will have her pension cancelled.
It is difficult to think about making a Will but it’s worth putting plans in place for what happens when we die.
As the above example shows even if you have few assets, dying without a Will could lead to complications for your surviving spouse. In todays society with a high divorce rate leading to blended families more complex asset holdings including superannuation and the family home. A Will has become more important in order to direct your assets.
If you are looking to give your assets in such a way that enables your loved ones to maintain a pension or other government benefit your need to discuss your options with a financial planner and lawyer; if you die intestate any plans that you have in place could quickly unravel.
Importantly take action today and once your estate plans are in place, review those plans annually or following any major change in your life or asset holdings. Because even in a straightforward situation like the one above the widow is now doing cleaning work in order to support herself as the assets went to her due to her husband overlooking making a Will.