What are the key documents in an estate plan?

Modern Estate Planning is about a workable plan – not just a Will

It involves a powerful combination of 5 key documents and an ongoing management system that works quietly in the background for you as a personal backup system.

So what’s your Plan B? (just in case)

Generally peoples main concerns are ‘what if I become disabled, short term or long term, who makes decisions for me then, what happens to my stuff if I die and who brings up the children if I’m gone before my time? Typical concerns of a client seeking estate planning advice form Sapience

The key documents you should have up to date, in place and stored securely away from your home

The 5 Key Documents that make up a powerful Estate Plan.

1. Power of Attorney – who can make legal decisions for you if you’re unable to for a period of time eg: overseas on holiday and contactable, you’re in the hospital and unable to make key decisions due to sickness or injury. Overseas travel and local car accidents are common reasons when people often call upon this document.
2. Enduring Power of Guardianship – means you can appoint a person of your choice to make key decisions if because of your incapacity, you’re not able to make those key decisions for yourself.
   Without a POA and EPOA documents in place, your family usually would have no option but to make an application to a tribunal (different in each Australian state) for a Grant of Guardianship and legal administration orders over you and your property This process is a distressing and expensive process that can be easily avoided by simply having the plan in place ahead of time.
3. Will – this is the most important document that will ever sign in your life and it has the power to dramatically change the lives of those you love and protect and provide for. Why risk this to the curse of a one size fits all DIY Kit?
4. Letter of Wishes – This is a document that can be regularly updated that helps to make sure your intentions and decisions are clear. It's designed to help the people responsible for implementing your Will to understand exactly what your intentions were.
5. Testamentary Trust – allows you to make a just-in-case plan that can look after your spouse, your minor child or even your aging parents if something happens to you and you’re no longer there to care. These powerful structures can protect an inheritance from a person battling addictions, facing family court issues or people who are simply not experienced in dealing with large sums of money. Understanding how these trusts work means you leave a blessing and not a problem.

How do you know if you have a good estate plan in place and not just a Will?

These are the key questions you should be able to answer confidently if you have a backup plan in place:

• Do you have a Power of Attorney document in place?
• Do you have a Power of Enduring Guardianship in place?
• Do you have a Will in place that was reviewed in the last 3 years?
• Does your nominated Executor and your Financial Advisor know where these are safely stored?

You should be able to name the key people nominated in your Will

• Your Executor
• Your Guardian for minor children
• Your Trustee

Can your Will be found by your Executor if it's ever needed (or is it hidden away?)

• Do you keep track of their contact details each year?
• Do they know where your key documents are stored?
• Do they know that they have professional legal and financial advice support already in place should they be called upon?
• Do you have insurance funding in place to make it all work?
• Where is the plan stored and how do you know it’s up to date?

If you could answer 'Yes' with confidence to most of these – you’re probably sleeping really well – Congratulations you have yourself finally sorted!

Drew Browne is a specialty Financial Risk Advisor working with Small Business Owners & their Families, Dual Income Professional Couples, and diverse families. He's an award-winning writer, speaker, financial adviser and business strategy mentor. His business Sapience Financial Group is committed to using business solutions for good in the community. In 2015 he was certified as a B Corp., and in 2017 was recognised in the inaugural Australian National Businesses of Tomorrow Awards. Today he advises Small Business Owners and their families, on how to protect themselves, from their businesses.  He writes for successful Small Business Owners and Industry publications. You can read his Modern Small Business Leadership Blog here. You can connect with him on LinkedIn.  Any information provided is general advice only and we have not considered your personal circumstances. Before making any decision on the basis of this advice you should consider if the advice is appropriate for you based on your particular circumstance.