Estate Planning: a plan for life

There are only two certainties in life: your birth and your death. While one is celebrated and talked about, the other is an elephant in the room – the topic you speak about in hushed tones. Nobody likes to think about their own mortality, but by avoiding the subject you risk leaving your family with a financial mess to unravel at a time when they will be grieving their loss. Estate planning is a crucial aspect of ensuring the smooth transition and management of assets and affairs in the event of incapacity or death.

At what age should I start estate planning?

Today! Many people assume estate planning is purely for more senior members of the community and the very wealthy, but everybody benefits from professional estate planning. It’s about protecting your wishes while you are alive but lack capacity (Enduring Power of Attorney) and protecting your assets and finances when you have died.

Enduring Power of Attorney

In New Zealand one essential legal instrument to play a significant role in effective estate planning is the Enduring Power of Attorney (EPA).

What is an Enduring Power of Attorney (EPA)?

It’s a legal document that appoints an attorney or attorneys (you handpick someone you trust implicitly and who understands your values and wishes) to act on your behalf if you can’t or don’t wish to. It’s a safeguarding mechanism to protect you during unforeseen events – if you have an accident or suffer from an illness that impacts your ability to run your own affairs.

There are two types of EPA, you can choose either one or both:

Property: this is where your financial affairs and assets are managed for you. For example, paying bills, managing your home and handling investments.

Personal care and welfare: this is where you can make decisions now about your future care and personal health and wellbeing should you loose capacity.

How does an EPA help with estate planning?

Without an EPA in place, if you were to lose mental capacity, a loved one or relative would have to go through a lengthy and costly legal process to obtain the legal authority to make decisions on your behalf. This process, known as an application for welfare guardianship or property management, can be time-consuming, emotionally draining, and may not necessarily align with your wishes. Without careful planning you risk a court making decisions against your personal beliefs.

Appointing a trusted individual to manage your affairs when you are unable to do so ensures your interests are protected, decisions are made in accordance with your wishes, and the potential for financial exploitation is minimised. Engaging in estate planning simplifies the administration of your affairs during challenging times. Seek professional legal advice to draft an EPA to align with your unique circumstances and goals.

How do you get an EPA?

Weston Ward and Lascelles are a Christchurch law firm with extensive experience of setting up EPAs. We work closely with clients to understand what they want their EPA to achieve, and what they want to avoid. Before your first appointment consider:

• Who do you want to appoint as your attorney for Property and who you wish to appoint for Personal Care and Welfare (it does not have to be the same person, or we can represent you if there is no one you implicitly trust).
• Which assets will need attention? Do you have a property/properties? Do you have money owed to you? Do you have debts?
• Do you want conditions to be applied to the EPA? For example, should the attorney provide annual reports to family members? Should the attorney consult with certain people before decisions are made?
• Do you wish to appoint another ‘back up’ attorney in case your first choice is unable to continue with their duties?

Because we are a multi-disciplinary law firm, you also have access to the best legal advice to ensure your assets are held in the most tax efficient and beneficial way – whether that’s advice from Weston Ward and Lascelles’ Christchurch Business Lawyers for succession planning or taking advantage of our Will writing service to ensure your assets are protected after death and distributed in the way you intend.

Estate planning: What you can do today?

If you Google ‘estate planning NZ’ and scroll past the paid advertisements, you will note there are many thousands of search results. The lion’s share refers to how to divide and protect your assets through estate planning, Wills and Trusts; but what they don’t do is give practical guidance as to how you can organise and manage your affairs while you are living so those dealing with your estate can do so easily, efficiently and at minimal expense.

Organise important documents

Although we live in a digital age, there are still some paper documents that remain important. Collate your important documents and keep them together in a file in a secure place at home and/or at your lawyer’s office. Important documents include:

• A copy of your most up to date Will
• Your birth certificate
• Land titles and mortgage agreements
• Copies of insurance policies you have
• Superannuation details
• Details of your bank accounts
• Details of the property you own and any investments you may have, and who to contact about them (include reference numbers)
• Instructions about how to distribute any personal belongings that are not recorded in the Will
• Details and passwords of online accounts (see below)
• A list of organisations to inform about your death
• A list of regular payments or subscriptions to cancel

Protect digital assets

Trying to retrieve digital information after someone has died is time consuming and stressful. Many of the larger platforms have now made provisions for their users to designate a third party to control their profiles should they die. So rather than having to update your important document file each time you change a password, you can specify who you wish to have control of your accounts and digital assets. For example, Facebook has created a legacy contact option and similarly Google operate an inactive account manager so your nearest and dearest can access accounts when you have died.

Weston Ward & Lascelles’ Christchurch Family, Wills and Trust lawyers sympathise with how planning for one’s death may be out of your comfort zone, but experience has taught us how necessary it is to dot the i and cross the t to have your wishes fulfilled. To learn more about how we help to protect you and distribute your assets, click here or call us today on 03 379 1740 to arrange for a no-obligation chat.