Quick Glossary

These may be the key means of leaving a legacy but advisers need to be aware that wills can be (and often are) highly contested, and punitive rates of 'death tax' usually apply to inherited superannuation benefits.

A testamentary trust is established in accordance with a client's Will document. It allows the trustee to manage assets on behalf of the trusts' beneficiaries. While testamentary trusts are a popular estate planning tool, they do come with legal and administrative· costs.

Investment bonds are tax paid investments, meaning that when earnings are received, the investment bond issuer pays an effective tax rate of up to 30% of the earnings. However, with careful management this tax rate can be reduced to 12-15%.9 The investment bond holder doesn't even have to include the investment bond's earnings in their tax returns. After 10 years the
investment bond can be redeemed tax-free.

Probate is a court order that confirms a Will document is valid, and that the executor has permission to distribute the estate.

These legal instruments empower individuals to name someone to manage their affairs when they cannot do so.

These are assets that do not form part of a client's estate, and which cannot be controlled by their will. Superannuation is an example of a non-estate asset.

Central to understanding mental capacity in Australian Power of Attorney documents is the presumption every adult possesses the inherent capacity to engage in legal transactions. This presumption recognises our intrinsic ability to make decisions, unless evidence suggests otherwise. However, this presumption is not rigid and it adapts to the specific circumstances of each case and pivot on an individual’s ability to grasp the nature and implications of the transaction they are entering into.

Leaving a lasting mark on those who follow matters to many advised clients. Some 75% of Australians worry about something impacting their ability to leave a legacy, making quality financial advice more important than ever.

A tax-paid investment structure with tax on earnings paid by the investment bond issuer, at a rate of up to 30%. Investment bonds are structured around a client's personal wishes, with the flexibility to control how their wealth is passed on.

Dying Intestate in NSW means that someone else will decide who inherits your estate. It is a much better idea for you to make a will, so you can decide how your estate is distributed.

If you have children who are under 18 years of age, it's a good idea to nominate someone in your Will Document to look after and make important decisions about your children if both you and their other parent passes away, while they are still under 18 years of age. This person is known as a Guardian.

An Executor is the person named in a Will Document to carry out the wishes of a person after they die. They organise to collect the assets of the deceased, pay the debts and distribute the property as set out in the deceased's Will Document.

These are assets that can be controlled by a person's Will document. They typically include personal property, such as a car, and/or or financial assets, such as the deceased's bank balance or directly held shares.

These things are called your personals assets throughout your life. But when you pass away, your personal assets become part of what’s called your deceased estate. Deceased estate is the term used to describe the assets and liabilities you leave behind when you pass away.

Unlike personally held assets, superannuation need not be bequeathed via a will. Binding death nominations provide certainty over who will inherit a client's superannuation.
However, some super funds only offer nonbinding nominations, and in certain cases, nominations have been ignored by fund trustees, resulting in costly legal proceedings.