Phase 8 – Estate Planning and Phase 12 – Retirement

In Show 109 – Phase 8 – Estate Planning and Phase 12 – Retirement originally broadcast on Facebook Live on Wednesday 11 July 2018 we explore this interesting topic.

You can download a copy of the workbook for todays show here: 109 – Worksheet

Show Notes

All throughout July 2018 we are talking about retirement and estate planning.  Figuring out who should get your estate are hugely important questions.  This must be dealt with properly.  Today on show we detail some of the things you should consider when creating your estate.

If you die without a will your estate will be governed by the law of intestate.  Different states have different intestate rules.  The money doesn’t just automatically go to the government.  The estate tends to be split between spouses and children.  Your shares in any businesses you own will also be split among your family members.  In order to avoid that outcome you have to sit down with your lawyer to put a process in place to ensure that your estate is divided according to your wishes.

Buy/Sell Option Agreements is an agreement that is triggered upon death or incapacity.  It details the sale of your shares in the business and who gets the money.  This can ease a very stressful time both for the family and the business.  Insurance policies can be purchased to fund the sale of those sales so the business doesn’t have to scramble for the money.

Having a will in place is incredibly important.  Your will will guide the executor on how you want your assets divided.  As you prepare this document things that need to be considered are how to deal with blended families or with estranged family members.  Excluding people from wills can create a tremendous amount of litigation.  You have to consider the fate of all your assets including the fate any companies you own in part or in whole.

Power of attorney is a document that gives another person the ability to make decisions on your behalf, including the signing of documents.  That is a tremendous amount of power so you have to be sure you are crafting this correctly.  A general power of attorney is used in number of circumstances.  They are usually short-term and are often used  when someone is out of the country.  An enduring power of attorney is something different.  It is a stronger document that is maintained even if the person is incapacitated.  Health and financial decisions can be made by the person you entrust with this power.  Once you give someone that power you may not be able to get it back so make sure you choose someone you really trust.

Advance health directives are documents that detail what you want to happen during any medical treatment.  A doctor will tell you about what kinds of treatment options they will have during your time in their care.  If there are certain kinds of treatments you would not want to have performed you need to detail that in this document.  Those decisions would then guide your doctor in the event of your incapacitation.

Back in 1992 employers In Australia were compelled to take a portion of their workers wagers to create superannuation funds for their retirement.  Most people in Australia have a superannuation fund that is managed by large institutions.  There is another option.  A self-managed superannuation fund is very similar to a trust.  It’s a fixed trust that overseen by a trustee.  The money is then divided among the members upon their retirement.  One of the main misconceptions around these funds concerns the selection of the trustee.  The trustee is liable for any debts incurred by the fund.  A company trustee should be created instead.  This protects the trustee from any debts and makes it much easier to choose a new trustee upon death of incapacitation.

More about this Show

We started Business Legal Lifecycle to create a simple way for you to understand complex legal terms.  Most importantly we want to help you to develop a plan to take your business successfully into the future.  There’s a startling statistic the underscores the importance of developing a solid plan.  The majority of business owners are just seven months away from losing everything.  A single aspect of your business that is not set-up correctly can shut down your whole operation very quickly.   Legal advice is not cheap and even when you can afford it there is often a divide between lawyers and their clients.  We want to close that gap once and for all.  We want to put legal knowledge and tools into your hand to prevent the worst from happening to you.

Twice a week we are going to deliver those tools right to your home or office with Business Legal Lifecycle TV.  We’ll start the week with Fast Fix Monday, a short 5-10 minute video that will tackle a single issue that businesses have to deal with.  Then on Wednesday’s our main show will feature with more fulsome discussions and interviews all delivered in a straightforward and easy to understand format.