Often when someone calls me to enquire about doing a Will for them, the first question they ask is “how much does it cost?”. The answer to that question is “it varies”.
What does a Will do?
A Will helps protect your assets, ensuring those assets pass to your intended beneficiaries in a tax effective way.
In the Wills and Estates area, we use the term ‘Estate Planning’. Preparing your Will is a part of what we call your estate plan.
What is Estate Planning?
Estate Planning Solicitors generally help to arrange your affairs in a way that:
- suits your needs now;
- protects you should you lose mental capacity; and
- ensures your assets pass smoothly to your intended beneficiaries when you die.
What is your ‘estate’?
In simple terms, your estate consists of items you own. This may include:
- Real Estate – if owned individually by you or as tenants in common with another person.
- Money in the bank – where the account is in your name individually.
- Household and personal items.
- Vehicles – those in your name individually.
Superannuation may or may not form part of your estate. What you should do with your superannuation beneficiary nomination depends on your individual estate planning objectives.
Assets owned by a family trust generally do not form part of your estate, however, there are some technicalities to consider.
What is a Will?
There are many different types of Wills. There is no standard one size fits all template called a ‘Will’. Some examples of Wills are:
- Will that provides a Testamentary Discretionary Trust. These can provide better protection of assets and some great tax advantages.
- Wills that provides outright gifts to beneficiaries. Some people refer to this as a ‘basic Will’ or a ‘standard Will’. This style of Will should be used with caution.
- Mutual Wills. This is like a contract. People who have a blended family for example often benefit from this type of Will as it can protect each family unit.
- Will that provides a Special Disability Trust. A special disability trust caters for the current and future care, and accommodation needs, of a person with a severe disability or medical condition.
- Will that provides a Protective Trust. A protective trust is a trust that assists families and carers provide for the needs of a beneficiary who may have special needs.
- Statutory Will. This is a Will made by the Court for a person who does not have the capacity to provide a lawyer with instructions to make a Will for them.
The above is not an exhaustive list but you now get the idea! What type of Will is suitable for you depends on your individual circumstances and what you are trying to achieve.
What happens when you engage a lawyer?
The typical process when I do a Will for someone looks like this:
- I have an initial free telephone discussion with you.
- I obtain a brief outline of your assets and liabilities, your objectives and your family.
- I give some initial advice including what type of Will would be most suitable for you.
- I give you a fixed fee price.
- If you are happy with the price and wish to proceed, we move to the next stage.
- There may be documentation you need to provide to me to review such as, company documents and trust deeds.
- We have another consultation where details and instructions are taken in greater detail. This can be via telephone, skype or face-to-face. This can take anywhere from 30mins to 1.5hrs.
- I give you further advice in relation to your Will and also advice on what needs to be done with your superannuation beneficiary nomination.
- I draft your Will and send it to you to review.
- I talk to you about any changes you might need.
- I finalise your Will.
- I arrange for you to come and see me to sign your Will.
- Once signed, I store your original Will in safe custody.
As mentioned above, the cost varies. You spend a lot of time building up your assets, including your superannuation which is often a significant asset. Why spend so much time and money building up your asset pool and then decide to spend as little money as possible protecting those assets?
How law firms charge you for the legal work done also varies. I recently gave an example of fixed fees vs. fee for service, which are very different ways of charging you. I give an example regarding the preparation of a Will. I encourage you to visit the Little Estate Lawyers Facebook page and read the article regarding fixed fees versus fee for service.
The take home message!
Wills are not one size fits all. Wills are not cheap and that is because they are technical legal documents. There are legal requirements to be met for a Will to be valid.
If you see a sandwich board on the street that says “WILLS $120.00”, keep in mind that you get what you pay for! That cheap price now may result in tens of thousands (even hundreds of thousands) of dollars in legal fees for your estate when you die.
As a Wills and Estates Lawyer I spend a lot of time dealing with problems in Wills, the implications of which spread far beyond Brisbane and Sydney. Not only does a problematic Will and litigation cause great expense, it also creates stress and heartache for your loved ones dealing with the issues after you are gone.
I hope this article helps you understand a little bit more about Wills and Estate Planning. If you would like to discuss your planning in more detail please get in touch.