Why estate planning matters for solo parents

Whether you are juggling co-parenting arrangements or are a parenting on your own, having a well thought out estate plan is vital for you and your children.  

If you were to die without a valid or up to date Will, you would have no control over how, or at what age, your children would benefit from your estate, or how your children are provided for in your absence.  

What would happen if I died without a Will?

We get it, life is busy and time moves quickly, many parents struggle to get around to making a Will.

If you die without a Will in Victoria, things can get complicated:

• Rather than the administration of your estate being conducted by the Executor that you appointed in your Will, someone will have to apply to the Supreme Court for “letters of administration”
• The question of who is entitled to make that application may be unclear and cause great stress for your family
• The assets would then be distributed according to the Victorian rules of intestacy, which with a risk that someone could try and claim an interest as your partner or a dispute regarding how the estate is held and applied for your children

That’s probably convinced you to make sure you have a current and effective Will to protect your children and your assets, but there is a bit more that needs to be taken into consideration in making sure you have a complete and appropriate estate plan as a solo parent.

What assets are covered by my Will?

Not all assets are dealt with by a Will.

Both your superannuation and any life insurance associated with it does not form part of your estate and will be distributed by the trustees of your superannuation fund in accordance with the superannuation rules and their trust deed, unless you have a valid Binding Death Nomination in place. Using a Binding Death Nomination is a really effective estate planning tool for a solo parent as it can give you peace of mind that your superannuation assets will benefit your children and be managed by the most appropriate people. How to do this is a vital part of the discussion regarding your estate plan you need to have with your OFRM Wills & Estates Lawyer.

That estate planning discussion also needs to include consideration of how you will deal with other assets that might not form part of your estate such as business or company assets or family trusts.

Do my children receive their share immediately ?

Unless provided otherwise in your Will, your children would be entitled to receive their share of  your estate upon them turning 18. Often that will not be appropriate or sensible so most people have their will provide that entitlements for beneficiaries who are children or young adults, are held on trust by the executors until that child reaches a certain age – often 21, 25 or even 30.

When a will sets up an estate in this manner, our Wills & Estate Lawyers carefully draft the powers and responsibilities provided to the executors so that the entitlement is managed carefully and so that the funds can be paid to support the children in the meantime. This can include the funds being paid for their living expenses, education and wellbeing.

Can my estate plan include who cares for the children?

The arrangements for children when a solo parent dies is a convergence of various parts of the law.

Most times, the issue of who will care for the children is uncontroversial with surviving family and friends able to agree on suitable arrangements.

If agreement cannot be reached regarding the arrangements for children, perhaps because a surviving parent is considered not suitable to care for the children or because different interested parties want different outcomes, the dispute is a Family Law one.

The Federal Circuit and Family Court of Australia is the relevant court for such a dispute even having a special list if there is no parent available.  

If there is a dispute, the Court considers what would be the arrangements that would be in the child’s best interests with the outcome to set out who has “parental responsibility” for the child (long term decisions) as well as who they live with and when they spend time with others significant in their life. If there are current family law orders which provide arrangements, the dispute will be varying those orders.

Often people include in their Will appointing a guardian for their children. Such an indication is not legally binding upon anyone, but can be of great assistance to family and friends as an indication of what you consider to be the best arrangements and often assists agreement being reached. Such an indication can also be a relevant factor if the Court has to determine what is in the child’s best interests.

In considering who to appoint as a guardian you should take into consideration:

• The child’s relationship with their other parent
• The guardian’s capacity for dealing with the other parent
• The child’s relationship with the other parent
• The mental and physical capacity of that person to support your child
• The practicality of the child living with that guardian

What if I am unwell?

Having the right documents in place if you become unwell or incapacitated as a solo parent is also vital. You should have both a Medical Decision Maker and an Enduring Financial and Personal Attorney  in case your ability to make financial or medical decisions in the future is impacted.

A Medical Decision Maker appoints a person, or subsequent people, to make decisions regarding your medical treatment when you are not capable of doing so yourself or you have not already provided these instructions to your medical team.

An Enduring Financial and Personal Attorney authorises a person, or persons, to make financial and personal decisions on your behalf. This can include your attorney accessing your bank account to pay ongoing bills and expenses, selling your home and making living and lifestyle arrangements on your behalf.