Legal Tip 284: Do Young People Need Wills?

Discussion in 'Wills & Estate Planning' started by Terry_w, 4th May, 2020.

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  1. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Plus Member

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    Generally, you should have a will if you have any assets, or kids.


    Young adults generally do not have either. But don’t forget where they are working, they probably have superannuation, and this may have life insurance. So, a person without assets could die and their estate end up with a large payment from their superfund life insurance. The trustee of a fund is probably likely to pay the legal personal representative of the deceased member in this situation because there would likely be no one else they could pay – parents are not eligible.


    In such situations if the intestacy laws don’t match what the testator wanted their $1mil in life insurance could end up in the hands of the wrong person.


    Example

    Bart is 19 and dies during a bank heist. He had $1 in the bank, but had life insurance under his super with his part time job at Burger King. There is a $1mil payout which goes to the estate as Bart has no parents, children or dependants so the super trustee has not choice but to pay it to the estate.


    Bart hasn’t seen his dad in 10 years and hates him.


    Under the intestacy rules Bart’s parents would inherit his assets as he has no children and no spouse.


    This would mean his dad would get $500,000.50 of this estate and so would his mum. Bart would have wanted the whole $1,000,000.1 to go to his mum.


    Had Bart done a will – even a simple will kit type, it would have gave all of this to his mum. (assuming it was all valid)
     
    paulF likes this.