Can you now relax in the comfort that everything is under control? Certainly not. Remember, life is dynamic, and you will encounter major milestones on your journey through life. These milestones can be positive and life affirming. For example, you meet and marry the partner of your dreams or you bring children into the world and face the exciting prospect of watching them flourish and develop. The milestones can also be profoundly sad and traumatic, such as the death of a beloved family member. Sadly these events are part of our existence as human beings.
However, in the joy and sadness accompanying these trigger events, we need to take time out to assess the impact of these events on our future wealth and risk profile.
In the case of a forthcoming marriage, you need to spend some time thinking about the distribution of your property in the event of untimely death or disability after marriage. Marriage, for example generally revokes prior Wills. Everyone contemplating marriage should consider how their property should be distributed after marriage, and also discuss with their financial planners whether or not a new Will is necessary. If the marriage is a second marriage, the position is even more complex. In this situation, you need to think of a distribution of property which is fair to the children of the first marriage, and possibly your former spouse.
Many individuals fail to appreciate the limitations of a Will. A Will only operates on death of the testator. It does not operate where a testator survives a traumatic event, such as an accident or stroke, but loses mental capacity. It is preferable for individuals to execute an enduring power of attorney to cater for this contingency. In this document, you can appoint a trustworthy person of your choice to handle your affairs during your period of incapacity. This provides certainty, and reduces the risk of state government interference and delays should you lose the capacity to manage your affairs.
Do not forget, in rejoicing over the birth of a child, to review the impact of the new arrival. It may be necessary to review your insurance needs to provide a source of funding for education and living costs in the event of your untimely death. It is also important to consider whether or not your Will and superannuation beneficiary nominations need updating. There have been instances of newly arrived infants being excluded from death benefits simply because the deceased parent had neglected to update nominations to include the new arrival.
Other trigger events in your life which should prompt you to think of the future include:
· buying a home
· an accident or traumatic event
· receiving an inheritance or
· retirement or changing jobs.
There is no substitute for having a well-constructed estate plan. However, you need to do more. Major trigger events will occur as you go through life. When these events occur, it is time to review your arrangements in conjunction with your financial planner, insurance and legal advisers. This will ensure that your estate plan continues to be robust and effective.