Do you have a current Will? Do you need one?
In this past year you may have bought a house, established a business, moved in with your partner, welcomed a baby, booked your big OE or perhaps there are wedding bells on your horizon. Whatever this year has brought you, now is an opportune time to ensure that your Will reflects your current situation. If you don’t have a Will, now is the time to get one.
Death isn’t a pleasant topic, yet it’s an important one that’s often avoided by New Zealanders, particularly those in their 20s, 30s and 40s.
When a young New Zealander passes away they often do so without a Will. Although discussing one’s mortality can feel uncomfortable, knowing that you have a valid Will can provide you and your family with the peace of mind that your final wishes are known and will be adhered to.
When thinking about a Will there are some important questions you need to ask yourself.
Who should be the executor and trustee?
All Will-makers must appoint an executor and a trustee. An executor obtains probate for your Will from the High Court and your trustee carries out your wishes. Although the executor and trustee are separate roles you may appoint the same person to fulfil both.
Quite commonly a Will-maker will appoint a family member to these positions. However, it’s important that you think about whether a person is suitable for such a role in regard to the dynamics of your family.
Keep in mind that in times of grief many people will operate on the periphery of their personalities. Ask yourself whether appointing certain people could cause strain on your family’s relationships. For example, if your parents are separated, will choosing one over the other cause unnecessary friction?
If you choose not to have a family member or if the distribution of your estate is likely to be complicated, you may prefer to appoint your lawyer or a trustee company.
What are my final wishes?
In your Will you instruct your trustee to distribute your estate to whomever you wish, for example you may like to:
- Leave your property to your partner, children, grandchildren, other family members or friends you wish to provide for
- Leave some of your property, money or other assets to a family trust
- Specifically leave items such as cash, jewellery, artwork or furniture to particular friends or family members
- Leave money to a specific charity or organisation
- Give instructions to your executors if you own a business, and
- Instruct your executor as to how you would like your body to be handled, whether you’d like to be cremated or buried (and if so, where?) and how you would like your funeral to be conducted.
If you are a young person and have assets, which could include insurance policies, but do not have a Will then on your death your parents would need to apply to the court to administer your estate. This is very difficult for a grieving parent as generally under the law they are the ones to inherit. They are left feeling that they are trying to benefit from your death. If, however, you have left a Will under which your parents benefit then they know that was your wish and are left feeling more comfortable.
When drafting a Will keep in mind that you may be obligated to provide for particular people (such as your spouse or partner, children and so on) under the Family Protection Act 1955, the Property (Relationships) Act 1976 and the Testamentary Promises Act 1949.
How will I pay for a funeral?
Money is the last thing people want to think about when grieving. Therefore it’s practical to give this question some serious thought. Many young New Zealanders are only beginning to build their capital and many have substantial debt. Accordingly you may want to contact your insurance provider about both life and funeral coverage insurance.
Funerals can cost thousands of dollars. If it’s unlikely that your estate could cover your funeral costs, preparing for the future will save your loved ones unnecessary financial strain.
The same can be said if you are servicing a mortgage. You may want to ensure that you have insurance cover for your mortgage and also have income protection insurance for your partner and/ or children.
Who can draft a Will?
In order for your Will to be legally valid:
- You must be 18 years old or over,
- It must be in writing,
- It must be signed by you, and
- It must be witnessed and signed by two people who are not benefiting under the Will.
It’s very important that anyone who has assets also has a current Will. Make yourself a time in the next few weeks to think about the questions we’ve posed above. If your Will needs updating or you need to make your first-ever Will, do get in touch with us as soon as possible to discuss your wishes. It will give you and your family great peace of mind to have this End of Year Resolution ticked off.
Used by permission, Copyright of NZ Law Limited, 2017