If the worst should happen you want to know that your affairs will be taken care of. Accordingly, the four documents everyone should have are a Will, an Enduring Power of Attorney, an Enduring Guardian and a Superannuation Binding Death Benefit Nomination.
A Will is a document that sets out what you wish to happen to your assets after you die. Although the law makes provision for what happens if you die without a Will, (called an intestacy), it may mean that your assets are not distributed to the person or persons you would have chosen and the distribution of your assets may be made by someone you wouldn’t have chosen. Having a Will leaves your family in no doubt of your intentions for the distribution of your assets and thereby avoids unnecessary conflicts within the family after you die. Having a Will also usually means reduced legal costs and Court fees than would apply in connection with administering your Estate if you died without a Will.
2. Enduring Power of Attorney
A Power of Attorney is a document by which you appoint another person to act in your place in legal, financial and property matters. You may need a Power of Attorney if you are not physically capable of managing your financial, property or legal affairs. This may be because of circumstances such travel, poor health or being placed in a hospital or a nursing home. However, a normal Power of Attorney (called a General Power of Attorney) is often inadequate as it loses effect if you lose mental capacity. Accordingly, you need what is called an Enduring Power of Attorney. An Enduring Power of Attorney will continue to be effective even when you lose mental capacity to carry out your affairs. To be effective, an Enduring Power of Attorney needs to be signed by a lawyer, Registrar of the Local Court or approved officer from the NSW Trustee and Guardian who is satisfied that you have the requisite capacity to understand what you are signing.
3. Enduring Guardian
An Enduring Guardian is a document by which you appoint another person to make personal decisions or decisions relating to health care or lifestyle on your behalf. An Enduring Guardian is most commonly used to make decisions for you regarding your accommodation or your medical treatment when you are unable to do so. To be effective an Enduring Guardian must be signed by a lawyer, Registrar of the Local Court or approved officer from the NSW Trustee and Guardian.
4. Superannuation Binding Death Benefit Nomination
Many people believe that the beneficiary nominated on their superannuation form is the person who will receive their super after they die. In actual fact, it is the trustee of your superannuation fund who decides who receives your super benefits. If you do not have a Binding Death Benefit Nomination (Binding Nomination), the superannuation fund must go through a process of notifying anyone who may be entitled to make a claim on your super. This may lead to people who you didn’t intend to receive your super making a claim. It can then become a time consuming and costly process if beneficiaries appeal the trustee’s decision through the Superannuation Claims Tribunal. To avoid this situation it is important to enter into a Binding Nomination. This binds the trustee of your super fund to distribute the funds in accordance with your wishes as set out in the Binding Nomination.