In this article by Priscilla Dickinson from Newshub, I explain why you should update your Will following a separation.
Getting your last wishes on paper is the only way to ensure that, should you die, the things you own end up where you want them to go.
According to the Commission for Financial Capability, over half of Kiwis don’t have a will. Research by the Public Trust in June and July shows there’s a common misconception that if you’re married or in a relationship, you don’t need your own will and that it would still be valid if the partners were to separate.
Glenys Talivai, chief executive of Public Trust said that regardless of relationship status, each person needs their own will and it should be updated if the relationship changes.
“A will is still valid after a legal divorce, but anything assigned to [the] ex-partners in the will becomes void.
“If you enter a new marriage after a will is made, it will usually revoke any will you wrote previously, Talivai added.
Experts say that from a legal perspective, anyone with $15,000 or more, including funds in KiwiSaver, should have a will.
Your will doesn’t just take care of where the big assets should go: you can also specify the guardian for children, preferences around your funeral and cremation or burial, management of social media accounts and who would look after pets.
Why have a will?
A will gives you the opportunity to choose where you want your assets and possessions to go and how things will be taken care of.
Even if you don’t own a home or other assets, a will lets you ringfence personal items and decide who they will go to, for example, a ring inherited through the family.
Who should have a will?
Talivai confirmed that anyone with assets of $15,000 or more (including KiwiSaver savings), should have a will and that every adult should have their own (individual) will, whether they’re in a relationship or not.
Despite this, research from a 2017 Commission for Financial Capability Barometer Survey shows that 74 percent of people aged between 18 and 34 and 51 percent of people aged 35 to 54 don’t have a will.
Sharon Chandra, senior associate at Turner Hopkins confirmed that both people in a relationship need a separate will and that an assumption that everything would go to a surviving partner is not entirely correct.
“The legislation sets out who receives what.
“If [one] partner dies, the legislative figure for the surviving spouse is $155,000, with one third of the remainder going to the surviving spouse and two-thirds going to the children equally,” she said.
What is the cost to set one up?
The cost of a simple will through Public Trust will set you back $289, or from $350+ GST through a lawyer.
Various online will kits will cost you much less and, while these may stand up legally, Chandra said that the value in getting legal advice to set up your will is the more in-depth advice you receive and that it’s more likely to stand up, particularly in blended family situations.
“An off-the-shelf will kit may be subject to a claim.
“If you receive legal advice, the will is more likely to be watertight if challenged.”
What happens to a will upon marriage or separation?
Chandra confirmed that a will should be updated upon both marriage and separation.
“When [people] get married, unless the previous will states that it was made in the expectation of marriage, it is automatically invalidated,” she explained.
Jeremy Sutton, divorce lawyer said that if there’s a will in-place where an ex-spouse is the beneficiary, he or she would still be entitled to benefit from the estate.
“Your current partner and any future children you might have would have to bring a claim to the Family Court, which can be a [long] and expensive process.
Sutton also said that if there were a new relationship, depending on how long the people had been together, and any children, there could be rights for a new partner to claim, but there would likely be restrictions.
“It is [therefore] necessary to update your will after a separation,” Sutton said.
Could a back-of-an-envelope will be valid?
A will is a legal document and given the range of options, can take different forms.
To be valid, Chandra confirmed that a will document requires two witness signatures and should specify the person who would administer and execute the estate.
Although a back-of-an-envelope will could be considered valid, it is more likely to be contested by third parties.
Getting a will in-place can be thought of as an arduous process, but depending on your individual circumstances, it needn’t be expensive and can be empowering.
Experts confirm that a will should be made individually and reflect your wishes at any given time – update it when a relationship changes, when starting a family or buying or selling a home or business.
A will helps to make sure that in the event something happens, there’s no guesswork around who gets what. How in-depth you want that to be is up to you.
This article was first published on Newshub.