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Estate Planning

Financial Advisers can offer professional support when formalising wealth transfer plans. It is important that we also encourage involvement of the next generation. It’s important that your adviser is aware and is part of your planning with your estate.

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    No one likes to talk about death, everyone hates the D word. We went to a workshop recently and they were calling it celestial passing. The reality is, it happens, and not when you expect it. Avoidance is cheap and easy and costs nothing. The legacy you leave is that of relationships, and it’s so important that your will reflects exactly how you want to be remembered.

    Even a seemingly simple situation requires more than a simple will once partners are involved. We have highlighted some pertinent points to inspire you to ensure that your estate planning is not something that you avoid and put little resource into, but that you see it as your final wish, your final relationship with your loved ones. It’s an investment in the memory you leave of yourself.

    Hudson work with 2 very experienced estate lawyers. Loan Chow from YHC lawyers has much experience working with clients who have complex financial structures, blended families and clients requiring extensive wills, EPOA and health directives.

    Clayton Block from Empire Law has extensive experience in wills and conveyancing. Have a look at Empire Legal here. He specialises in Mum and Dad wills and his price list is here. We use both of these brilliant lawyers for our own legal work and cannot recommend them highly enough. They are both family run firms, like Hudson, and their focus on relationships is to be admired.

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    Plant a tree with us today, to sit in the shade in the future.

    Why is it so important to include Estate Planning with your Financial Plan?

    A personal legacy and financial legacy are most common associations, tying the two together is key to success.

    Thank you to Generation Life for providing these tables and statistics.

    What do you associate with leaving a legacy behind?

    leaving legacy

    Intention to transfer wealth is evident, particularly to children and grandchildren.

    intention to transfer wealth

    When do you intend to transfer wealth?

    More than half intend to do at least some wealth transfer while they are still alive.

    when transfer wealth

    Assurance of financial future key to an early transfer of wealth, along with the opportunity to enjoy the outcomes.

    reason for transferring

    Key outcomes…

    • Automatic transfer of ownership
    • Full ownership before bond is transferred to recipient
    • No impact to recipient’s personal tax position
    • Ability for recipients to set up an estate plan
    • Restrictions on Co-signatory accessing funds
    • Set up Regular Income Payments
    • Co-signatory
    • Tax offset for withdrawals before 10 years

    Did you know… Australia has one of the highest life expectancies in the world.¹

    Around one in four Australians aim to retire between the age of 60 to 62.

    Two in five Australians expect to spend more than they currently do in the first years of retirement.

    Financial Advisers can offer professional support when formalising wealth transfer plans. It is important that we also encourage involvement of the next generation. It’s important that your adviser is aware and is part of your planning with your estate.

    Some interesting facts – thank you again to Generation Life

    Leaving an inheritance and the challenges of wills.


    Successful family provision claims by estate size:

    Estate Claims

    Investment Bonds

    Investment bonds and investment linked lifetime annuities can be used within a retirement portfolio to prevent estate claims. They have a number of other benefits also which are highlighted below.

    For clients who do not want to utilise life products, and for clients where it is not necessary, your adviser would look to create income streams from your equity portfolio using what we call in the industry, a bucket strategy. Please read more about this here. It is important that we are aware of your beneficiary wishes in every situation so that we can advise on the most tax effective distribution at every stage.

    Investment Bonds are one option that advisers can use to your estate’s benefit. They sit outside the will and cannot be challenged when a beneficiary is nominated.

    Investment bond estate planning benefits:

    • Life insurance contract: A type of life insurance policy which is investment-based governed by the Life Insurance Act
    • Non-estate asset: Investment bond can be structured as a non-estate asset
    • Tax-free proceeds: Proceeds on death are paid tax-free even to non-dependants
    • Automatic transfer: Automatic transfer at specific ages, dates or on death can be selected
    • No tax reporting: No tax reporting if no withdrawal made in the first 10 years
    • Avoids conflict: Avoids potential for conflict and solves complex wills

    A Case study to highlight – thank you to Generation Life.

    Meet Margo…
    Margo is 77 years old.
    Margo has 3 adult non-dependant children; Sarah, Jane and Sam.


    Margo’s three Children…


    • 51 years old and married
    • Both on 47% MTR (including Medicare Levy)
    • 3 young children
    • On track to reach the proposed $3m super double taxation threshold


    • 46 years old and single
    • Not good with money
    • No stable job


    • 42 years old and single mum
    • Works part time and on 21% MTR (including Medicare Levy)
    • 7-year-old twins

    Margo’s concern…


    • Confident that Sarah is good with money
    • Concerned that her inheritance will burden Sarah with a huge tax liability


    • Concerned that Sam may need income
    • However, doesn’t want a lump sum transferred due to the potential misuse of the funds


    • Concerned that Jane needs support to help fund her grandchildren’s secondary school education

    Margo’s current financial position…

    Margo seeks financial advice to see how she can help structure her estate according to her wishes and deal with her concerns

    Home Value $2.5m
    Cash at bank $100,000
    Superannuation balance $2.1m
    50% taxable component (she maximised non-concessional contributions at age 75)
    Bank shares $175,000
    Weighted average price of $23.00 accumulated between 2006 and 2010
    Managed fund investment $10,000
    Capital loss of $10,000
    Direct Growth ETF $20,000
    Bought 2 years ago, currently worth $22,500

    If you'd like to know how this case study ends, contact us today!

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