You’ve spent years building up your wealth – don’t you want to keep it safe? Make sure it goes to who you want and is used the way you want it to if things go wrong? A will and an enduring power of attorney are absolutely essential to ensuring that happens, but too many Kiwis don’t have them. Here’s why that’s a mistake:
There’s a common view of wills as lengthy legal documents that greedy relatives fight over as soon as the patriarch or matriarch of the family passes away. That’s how it is in the movies, but the reality is quite different.
Where there’s a will, there’s a way – to make sure the things most precious to you go to where you want them after you pass away. That might include cash, property, stocks and other assets, as well as more sentimental things like jewellery and mementos. In fact, it’s often the sentimental things that are the most important!
It also covers who gets guardianship of your kids, should you pass away unexpectedly while they are under the age of majority.
“But Money Empire blog,” I hear you cry, “won’t all that stuff just go straight to my partner?”. Not necessarily. This could be contested. It can become very messy, involving courts and lawyers and a rigmarole that you wouldn’t want to put a grieving partner through.
It’s all about making your wishes known. Without a legally binding, properly documented will, all of that goes up in the air and your loved ones may not be able to catch all of it before it hits the ground.
Plus, it’s really not as expensive as you think. The crew over at Public Trust can do you a basic framework for as little as $69 – and it only takes a minute or two.
Can’t be bothered? Well, it is quite literally your funeral.
That’s enough about death. Let’s talk about the enduring power of attorney. Again, this is something that a lot of people think they know about but is actually very different in the real world.
An enduring power of attorney is a legal document that gives someone the responsibility for your personal and financial wellbeing in the event that you are deemed unable to care for yourself. If you got very sick, had a brain injury, went into a coma, or something that renders you incapacitated, they can use this power to take care of you.
Here’s an example: Jerry, following the wise advice of Money Empire, has built up a solid portfolio of wealth-generating assets, including property, stocks and a bond or two. Unfortunately, he gets very sick and ends up being hospitalised, and then sent into long term care. Unfortunately, this care is very expensive, and the sale of a property is required to keep up with the costs. Thankfully, Jerry gave his partner an enduring power of attorney, which allows Jerry’s partner to sell Jerry’s personal assets to ensure that he gets the best care available.
An EPA is a little like having a will while you’re still alive. You can even stipulate certain conditions, such as your appointed EPA needing to counsel with your parents or family before making decisions. It ensures that the assets you’ve worked so hard to build get used to their fullest extent to care for you and your family.
Putting them together
A will and an EPA are two halves of the same coin. They deal with different aspects of your needs and wants, but at different points – one for after you pass away, the other for before. But they both aim for the same goal: keeping your wealth under your control and going where you want.
At Money Empire, our goal is to give Kiwis independence and power over their own lives through smart accrual of wealth and financial management. That independence and control doesn’t and shouldn’t stop after the worst happens.
A will isn’t expensive, and neither is an EPA, and they don’t take much time to put together either. In fact, you could get them sorted in less than a day, and for less than $300, for a basic framework that covers all the most important bits.
Don’t let your hard work go to waste. Give yourself and your family peace of mind with a will and an EPA.
For more information on the intricacies of wills and EPAs, check out the Beyond the Field episodes on wills and EPAs.