If you own a home, you need to think about making a Will

Disclaimer: The below guide is general in nature and do seek individual financial advice to see how this applies to your situation. Our experienced advisers are on hand to help at no cost to you (T’s and C’s apply)

Reproduced with permission from Footprint The Top 5 Things Every Couple Should Talk About | Footprint NZ — Info Hub (myfootprint.co.nz)

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When it comes to making a Will and planning for the future, we totally get it—thinking about suddenly not being around anymore is not fun to consider. For many of us, it’s been on the to-do list for a long time, or might feel easier to just ignore.

However, the unimaginable can and does happen. Being unprepared will not help your family, friends, or your other half—especially if they are suddenly left to sort everything out while also trying to deal with the loss of your wonderful self.

In relationships, it’s not uncommon to see one person take the lead on managing finances. While this setup may be convenient at the time, if anything were to happen and the responsibility suddenly shifted to the other person—wouldn’t you both want to make sure that your partner had all the support they need to take on the task?

Preparing is caring! Creating a Will is one of the best ways to care for those we love after we are gone. Below, we’ve put together the top 5 topics we think everyone should think about before putting a Will in place.  

1. How are your bank accounts are set up?

Understanding how your bank accounts are set up is important because it can significantly impact the access to funds you leave behind.

For example, any joint accounts—like accounts you have with a partner—would remain accessible. However, accounts that are under your name only—like any personal savings accounts—would be frozen and unavailable to anyone until your estate is fully administered.

Even if you have been sharing access to your personal account for a long time, unless that account is officially a joint account shared between yourself and your partner/family member, if you were to pass away, they would not be able to access it.

To give you some perspective—with a Will, administering an estate can take anywhere between 6-8 months to sort out. Without a Will, it can take 12 months or more, meaning that the one(s) you’ve left behind could be in financial limbo for a very long time, without access to potentially much-needed funds.

2. Ownership of the family home  

Your home is considered an asset, and just like your bank accounts, how you own property can impact what happens to it when you’re gone.

For example, if your home is owned equally between a couple and one person passes away, full ownership would be transferred to the other partner.

However, if there is only one named owner and they pass away without a Will, the home wouldn’t necessarily go to the partner. The process would instead fall under the Administration Act, which dictates how the property should be distributed. This scenario has the potential to get complicated fast, particularly if there are lots of other beneficiaries entitled to some of the property, like children or parents.

It is not unusual to be a little unclear on how a property is owned. If this sounds like you, we recommend doing a title search to be sure.

3. Choosing a guardian for children

Having a conversation about guardianship is not the same thing as writing it down in your Will. Many people don’t realise that if a child’s parents/legal caregivers pass away and there is no named guardian in a Will, anyone can come forward to make a case for guardianship. Of course, the case must be compelling and ultimately the decision will be up to the Family Court, but with a Will on hand, a judge is more likely to look favourably on your final wishes.

The likelihood of a child losing their parents/caregivers might be low, but it is not impossible.
However, the consequences of an unclear Will could impact your child for a lifetime. Heavy stuff we know, but worth thinking about.

Make sure that you have a clear understanding of the role of a guardian and have a conversation with your partner or family about how you want your children to be raised. Discussing this can help you determine who would be an appropriate guardian to step in if you’re no longer around.

4. Providing for a blended family

In blended families it is important to discuss how you would expect any children to be provided for by one another to reduce the risks of potential challenges further down the track.

Under the administration act, if you pass away intestate (without a Will) your children would be entitled to some of your estate, however your partner’s children would only be entitled to part of your estate if they were being “maintained” by you prior to your passing. Maintained doesn’t necessarily mean that they must be under the age of 18, and the meaning of maintained varies depending on the circumstance. For example, they could be entitled to part of your estate if they were living rent-free in your property.

Of course, your position on shares of inheritences may change as children get older. It pays to revisit your Will regularly to ensure it still reflects your wishes.

5. Executorship

Nominating your partner or a trusted family member as the executor of your Will might seem like a no-brainer; after all, they know you the best. But being an executor isn’t exactly a walk in the park. Executorship comes with a big responsibility; not only are they financially liable for mistakes that may negatively impact any beneficiaries, but it’s also a very complex and time-consuming job.

If you want to learn more about what’s involved in executorship, read our blog post here, on the role of an executor.

Create an online Will today with Footprint

Try Footprint’s online Will writing service to easily create a Will that expresses your wishes and holds up in court. With the four-easy-steps approach, you can make a Will online in no time and get peace of mind that you and your loved ones are safe, protected, and ready for the future.

Explore Footprint’s online Wills and if you have any queries, feel free to reach out to their lovely team, who will be more than happy to help.

Any information provided here is purely educational and should not be considered as advice.