When your loved one passes away, it can be an incredibly emotional time for you and anyone else close to the deceased. Issues of beneficiaries and inheritance only makes this process more sensitive, stressful and drawn out.
This guide to beneficiaries and Wills can help you be prepared with the information you need when becoming a beneficiary, or before appointing your own beneficiary.
Definition of beneficiary
A beneficiary is any person who has been left a gift or inheritance from a deceased person’s estate, as stated in their Will. Beneficiaries can be one person, several people, or even a charity.
What happens if I am a beneficiary?
You’ll be made aware that you are a beneficiary if you are not already, most likely by the executor of the Will. Beneficiaries are entitled to receive their gift or benefit within 12 months of the deceased’s death. If there is a delay in receiving the inheritance, the executor must provide a reason for this.
Writing my own Will
When it comes to writing out your own Will, it’s important to note down all your assets and anyone you would like to leave your estate to.
Who can be my beneficiary?
Your beneficiaries can be people or organisations who are important to you in life. Most people choose family and friends, however some people will also choose to bequeath some or all of their estate to a cause, organisation or charity they would like to give to after their passing.
Choosing a beneficiary is a deeply personal decision and shouldn’t be rushed into. Think about who or what you value and who you would like to financially take care of after your passing.
If you are including minor children in your Will, you may want to add provisions for somebody to be a caretaker of the assets until the children are 18 years old. Alternatively, you can leave funds in a trust that the children cannot touch until they are of legal age.
Changing my beneficiary
If your circumstances change or your original beneficiary passes away before you, you may amend your Will to change your beneficiary. Amending a Will can be a cumbersome process, as you’ll have to make an official alteration, known as a codicil. These changes must be witnessed and signed just like a Will, and if you make multiple codicils over time, they must be kept with the Will.
It may be a better option to rewrite your Will, as sometimes codicils can go missing. A new will revokes all previous Wills and helps keep your wishes up to date.
Can my Will be contested?
If somebody believes they should have been a beneficiary of your will and have been unfairly left out, they may be able to contest your Will.
To discourage your Will being challenged or contested, you can include a statement to explain that you are not providing for a dependant or close relative, such as: “I leave this person nothing in this Will”. Acknowledging you have intentionally left this person out of your Will won’t prevent them from challenging the Will, but it means they can’t argue that they have simply been overlooked or forgotten.
Do you need help writing your Will? Whether you just need a free Will or an entire estate planning kit, we have a package that suits your needs. Visit the Bare website here, or chat with our Wills and Estates team on (03) 9917 3388.
This article is not legal advice. You should speak with your solicitor or accountant for specific advice on your personal or financial situation.