Estate planning is an important part of your overall financial plan. It decides how your assets will be distributed amongst your beneficiaries when you pass away. When managed correctly, estate planning can benefit your loved ones greatly by tax effectively protecting the assets and inheritance you pass on.
Many people confuse estate planning with Wills, but it’s important to note that a Will only covers the distribution of the assets that form part of your estate and doesn’t govern all your assets. This includes superannuation death benefits, assets held as joint tenants and assets owned by a trust or company. Getting your estate planning under control will ensure you have everything in place, giving your complete peace of mind.
It’s also important to note that payments of benefits from a self-managed super fund, including benefits paid upon the death of a member, are covered by the rules contained in the SMSF trust deed, not the Will as many people assume. Therefore, you must structure your SMSF to include estate planning.
Your financial planner or SMSF advisor will discuss with you who you would like to appoint as your legal personal representative upon death. This person essentially takes over as trustee of your SMSF and will have significant control over how death benefits within a SMSF are paid out (whilst of course comply with any valid binding death benefit nominations that are in place).
Your SMSF can give you even more control of your estate planning and comes with many tax benefits for your beneficiaries, whether that be a spouse or child. Your independent financial planner can help you structure a solid estate plan within your SMSF that benefits your loved ones and fulfills your wishes in their entirety.
Contact D&M Financials today to find out how we can help with your SMSF and estate planning.