A relationship breakdown can instantly change your future plans.

Whilst unwelcome, it is the perfect time to make changes to improve your life & protect your future.

Relationship Breakdown

Life at a Crossroads:   Part 1 of 2

1.    Family Law – Property Settlement

If you and your former partner own property together, you might agree to transfer ownership to one of you, in exchange for a payment of money.

You will need to engage a lawyer for this process, and if you have a mortgage, your Lender will also need to be involved.

Usually, when transferring ownership of property, the recipient pays transfer duty and the former owner pays capital gains tax unless it was their home.  Two governments – two taxes – one transaction!

A Financial Agreement will avoid, decrease or postpones these government costs.  It’s essential to get advice before deciding on the best course of action!

2.     Jointly Owned Property

Where you jointly own a property with your former spouse, you must immediately confirm whether your names are recorded on the title deed as ‘joint tenants’ or ‘tenants in common’.

Where owned as ‘Joint Tenants’, you must engage a property lawyer to change the ownership to ‘Tenants in Common’.  This is quick and inexpensive – and no transfer duty is payable.

This process must be actioned immediately to ensure that your interests are protected from the moment of separation until the implementation of the final property settlement, which would most likely involve the property being transferred solely to one person – or the property being sold.

When someone dies owning a property as ‘joint tenants’, the surviving co-owner receives the deceased persons share of the property.  The deceased’s interest in the property doesn’t form part of their estate and their Will does not apply to that property.

3.     Superannuation Binding Death Benefit Nominations

You must review your superannuation arrangements with your Financial Advisor and/or the trustee of your superannuation fund.

Where you had previously nominated your former partner as the person to benefit from your Binding Death Benefit Nomination, you will need to notify the Trustee of your superannuation fund as to whom the death benefit will now be paid to following your death.

If you don’t maintain a current authority, the Trustee will make the decision – which may not be what you want.

4.    Will

When you separate from your spouse or partner, you must review your Will.

A simple Will may be sufficient to provide the immediate assurance you need.  Later, you can implement a more sophisticated estate plan to better protect your family.

As your Will does not deal with all of your assets and financial affairs, the first thing to do is to identify what assets are owned by you and will be distributed by your Will.

The process should include a review of other factors such as your insurance policies and superannuation – and provide directions as to how benefits are to be distributed following your passing.

5.    Estate Planning

You and your children may benefit from implementing a more sophisticated estate plan.

An estate plan is far more than a Will as it may also include:

  • a review of your life and risk insurance policies
  • a review of your superannuation funds and death benefit nominations
  • a review of your jointly owned properties
  • a review of your family circumstances to determine whether Testamentary Trusts may be beneficial
  • deciding who should be the guardian of any of your children
  • a review of your arrangements in circumstances where you are unable to manage your own affairs

6.    Parents Wills containing a Testamentary Trust

You may substantially improve your future financial security by ensuring that your parents create Wills containing a testamentary trust.

The benefit to you is that your parents’ assets can be protected from most claims made by any current or future spouse, or anyone else who seeks to take money from you.

Regardless of your matrimonial circumstances, where your parents are alive and mentally alert, it is crucial that you discuss with them the benefits, and you can take a pro-active role in ensuring that advice from an estate planning lawyer is obtained.

Disclaimer: The above is to be considered as general education. This is not advice and it is not to be acted upon without advice from a qualified professional who understands your personal circumstances.

Copyright © 2017 Wockner Lawyers. All Rights Reserved. Contact Wockner Lawyers – [email protected]. This article may not be used without the prior written consent from the author. See below for more details…
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For assistance with your Estate Planning and Will needs, contact Wockner Lawyers.

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