Many people know that when you die without a Will, your estate is distributed according to a formula contained in legislation, but did you know that the legislation in Victoria changed on 1 November 2017? Some may say it anticipates a Hugh Hefner lifestyle in that if you leave more than one partner, the law now makes provision for that. Probably not to the extent of the multiple partners that Hugh Hefner may have left; but that’s yet to be proven by the Courts implementing these new rules.
These new rules have the potential to result in smaller inheritances to children or other beneficiaries because of greater shares being allocated to multiple partners. It could be said that the stereotypical ‘Gold Digger’ has just been made legitimate.
If there are multiple spouses on death, they will need to come to an agreement as to the percentage of the overall inheritance they receive. If they can’t come to an agreement then the Court will step in and, of course, those expensive Court fees will eat into the amount everyone else gets.
A particularly dangerous situation is where you are separated but not legally divorced and have moved on to a new relationship. Should the ex receive an inheritance? Should the new partner receive an inheritance? If you don’t have a Will you don’t get a say and both the ex and the new partner may be entitled to your hard-earned cash.
It isn’t just the spouses who are receiving more under the new rules; gifts that could be identified as early inheritances (made pre-death) may no longer be taken into account if there is no valid Will. This might occur when a parent helps out their child with a deposit; helping them get into the property market. If the parent’s Will is invalid or there is no Will it is likely to disadvantage the other siblings. The Will is an opportunity to ‘even things up’. Not only is this financially damaging to the siblings that ‘missed out’ but it can result in the deterioration of family relationships.
What do your clients need to know?
Taking steps to prepare a valid Will is all about leaving your loved ones with peace of mind that they won’t have to fight in Court and lose a large amount of the estate in legal fees. Put simply:
Don’t be a statistic – get your estate planning in place!
If your clients need to discuss their estate planning requirements, contact Partners Legal today on 1800 333 143.