Getting Your Estate in Order: A (Real Life) Cautionary Tale

If you’ve been married 2+ times, or have kids with 2+ partners, it’s important to leave sensible & sensitive instructions for distributing your estate. Here’s why.

As a life insurance adviser, I’m often involved with the families of clients who have passed away.

Over the years, I’ve seen many tragic or troubling experiences that could have been avoided if the person who passed on had been more careful with distributing their assets in their Will. This is especially the case when the deceased was married (or in a de-facto relationship) more than once, or has had children with more than one partner.

If that describes your situation, then consider this real life story as a cautionary tale when you leave instructions in your Will for distributing your assets after you pass away.

The Problem

Some time ago, a client whose father had passed away got in contact with me.

Obviously, they were very upset about the passing of their dad. However, the emotional turmoil for my client and their siblings was amplified because of concerns about their father’s Will.

The father had been married twice, and was living with his second wife when he died. The home they lived in was still mortgaged, and his wife was hoping to get the proceeds from his superannuation insurance to pay off the house.

The children, including my client, were from his first marriage. They were concerned that they may not have been remembered in their father’s Will.

Complications

As it turned out, the children had nothing to worry about. Their father had completed a binding death nomination for his superannuation in favour of his children, and so the proceeds from his superannuation insurance policy were going to go to his kids.

While this was good news for the kids, their stepmother was now in a position where she may not be able to continue to pay the mortgage on her home, meaning it may need to be sold before it was repossessed by the bank.

As you can imagine, it wasn’t a great scenario. Especially for ongoing, amicable family relationships between the man’s children, and his widow.

Protecting Your Legacy

This situation wasn’t inevitable.

If the father had sought professional advice about the appropriate personal risk protection plan for his complicated circumstances, a solution could have been designed that would have been fair to his children, and to his second wife.

If your family situation is similarly complicated, then I urge you to seek professional advice now to avoid leaving a legacy of heartache and family strain in the future.

If you would like to learn more about how you can best to treat all family members fairly, please contact me at K2 Wealth on (07) 3368 2002.

 

Any advice contained in this article is of a general nature only and does not take into account your circumstances or needs. You must decide if this information is suitable to your personal situation or seek advice.

F.G.P. Pty Ltd T/A K2 Wealth ACN 121 446 204 is a Corporate Authorised Representative (No. 314978) of Clearview Financial Advice Pty Limited ABN 89 133 593 012 AFS Licence No. 331367