Most people say they don’t have an estate plan, and while it’s true they don’t have a will, every one of them has an estate plan – even if they haven’t planned it.
Why? Well, if you die without a will, the rules of ‘intestacy’ – a special statutory order – kick in to work out how to distribute your assets.
This may mean your assets end up going somewhere you don’t want them to.
To give you some very high level insight, if you don’t have a will in NSW, and you leave this world for good, you should expect the following to happen:
1.Your assets will be distributed to your spouse, followed by kids, parents, brothers or sisters, grandparents, aunts or uncles – pretty much in that order.
Blended families and those who have had multiple marriages get pretty complicated, but the intestacy rules have an order they use to work it all out.
2.De facto relationships will need to be proven and in place for more than two years or have resulted in the birth of a child to be considered spousal.
3.The NSW Supreme Court will have to appoint an administrator to look after your estate.
This may not be the person you would have chosen if you had written a will.
Their role is to arrange all your finances, collect assets, pay debts and establish the family tree so that assets can be appropriately distributed.
4.If you have no family then your assets will pass to the State.
At this point, dependents who are not family will have the right to make a claim on your estate. This could mean, for example, that a charity you had worked for could make a claim on your Estate.
Finally, it is also worth being aware that your super and family trusts are not automatically included in your will as they are their own separate legal entity.
The trustees of these entities will decide how to distribute those assets when you pass.