Will kits

DIY will kits are a low-cost option for drafting a simple will. CHOICE put four to the test and found big differences.
 
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01 .Where there is no will

wills

Do-it-yourself (DIY) kits promise a cheap and easy way to make your own will. CHOICE put four to the test, asking our experts to evaluate them. We found will kits can be an excellent research tool when drafting your own will and there are huge differences. Depending on your situation and skills, the best ones can enable you to do a DIY will. However, CHOICE recommends obtaining legal advice, particularly if you have small children, complex financial affairs or a complicated family situation. 

Who needs a will?

If you haven’t got around to writing or updating your will, you’re not alone: according to the NSW Public Trustee, about 40% of Australians don’t have a valid will. Even if you’ve made one at some point, it’s important to keep it up to date. If you marry, for example, your will is likely to be revoked; and if one of your beneficiaries dies, part of your will may no longer be valid.

 

Drafting your will may not be a pleasant task, but it’s essential for protecting your loved ones. If you die without a will, your estate will be distributed according to rules set out in state legislation. This may mean your spouse is not adequately protected, especially if they’re de facto. 

 

Traps

There are many pitfalls in drafting your will; in most cases, it’s safer to get expert advice:

  • Financial arrangements made in your lifetime, such as debts, joint tenancy or binding financial arrangements, don’t die with you – they must be honoured by your estate.
  • Superannuation is a minefield: selecting the beneficiaries may be up to the discretion of the trustee of your fund – someone you’ve never met and who does not know you or your family situation. 
  • Even if you disinherit immediate family members or dependants, they may still be able to contest your will.
  • If one of your beneficiaries dies, part of your will may no longer be valid and the gift you leave to them may instead be distributed according to state government rules.
 
 

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Do-it-yourself will kits are a low-cost option for drafting a simple will. CHOICE put four to the test and found big differences.

1. Will Form*

Supplier: Quill  Quill
Price: $3.35
Bought at: NSW newsagents
Description: Will form with some examples and basic instructions.

Good points

  • Very affordable.
  • Suggests obtaining expert advice if in doubt.

Bad points

  • Very basic instructions – could confuse rather than clarify.
  • Issues relating to children, taxation, superannuation and executors are not adequately covered. There is no option to select an alternative executor.

Verdict
Most basic of the will kits reviewed.
Simple will: OK – could be an option for a well-informed user who requires an urgent will and only has adult beneficiaries without special needs.
Complex will: Not recommended.

*Quill told CHOICE they no longer supply this product, and that it is only available through newsagents in NSW, Queensland, Tasmania and Victoria. 

2. Prepare-Your-Own Legal Will Pack - couples' will pack

Supplier: Nation Wise Products  Prepare your own
Price: $32.50
Bought at: Australia Post
Description: Comprehensive booklet with two will forms.

Good points

  • Contains a warning to obtain legal advice if your situation is complex or complicated.
  • Covers issues relating to children and briefly addresses superannuation.
  • Contains a warning to obtain legal advice if your situation is complex or complicated.

Bad points

  • Does not explain what would constitute a complex or complicated situation.
  • Taxation is not adequately covered.
  • Some instructions are given about the choice of executors, but the structure of the will form might confuse users about their options.

Verdict
Provides a good amount of information, is very accessible and well structured for a well-informed user.
Simple will: Good. Additional expert advice recommended if you have young children or adult beneficiaries with special needs.
Complex will: Not recommended.

 

3. Australian Will Kit

Supplier: National Call Centre  Australian will kit
Price: $38.08 (inc. postage, credit card fee)
Bought from National Call Centre
Description: Comprehensive booklet with two will forms.

Good points

  • Contains warning to obtain legal advice if your situation is complex or complicated.
  • Covers issues relating to children, taxation, executor and superannuation.

Bad Points

  • Does not explain what would constitute a complex or complicated situation. Deals with complex situations, such as CGT and trusts for children, in an everyday manner without repeating the warning to get legal advice.
  • Contains a statement that the executor cannot be a witness, which can be incorrect as long the executor is not a beneficiary.

Verdict
Provides a good amount of information and additional background material, is very accessible and well-structured for a well-informed user.
Simple will: Good. Additional expert advice recommended if you have young children or adult beneficiaries with special needs.
Complex will: Not recommended.

 

4. How to make your own will in Australia

Supplier: Legal Kits of Victoria  How to make your own will
Price: $36.30 (inc. postage)
Bought at: Legal Kits
Description: Comprehensive booklet with six will forms (three different types).

Good points

  • Covers the issues concerning provisions for children and beneficiaries with special needs.
  • Provides some information regarding superannuation and taxation.
  • Issue of witnesses is correctly explained.
  • Best coverage of the issue of executors of the will kits reviewed.
  • Will forms provide more options than those in the other kits.

Bad points

  • Does not contain a warning to obtain legal advice if your situation is complex or complicated, and seems to discourage the user from seeking expert financial or legal advice.
  • Does not make a distinction between complex and simple wills.

Verdict
Of the four DIY kits, this is the most informative and best overall. Provides a comprehensive amount of information and detailed background material, is very accessible and well structured for a well-informed user.
Simple will: Very good. Additional expert advice recommended if you have young children or adult beneficiaries with special needs.
Complex will: Not recommended.

How we analyse

Our two experts received a copy of the four kits and answered specific questions, including about how they rated the structure of the will kit and statements made on issues regarding children, executor, superannuation and taxation. We summarised the comments and made our own assessment to rate each of the kits for its effectiveness in drafting both a simple and complicated will for a well-informed user who has familiarised themselves with the topic.

Simple will A couple or single person with only a few beneficiaries and harmonious family situation, possibly owning their own home and otherwise straightforward possessions, such as household goods and a few bank accounts.

Complex will This could include blended families, such as children from more than one relationship, and complex financial affairs. The will-maker may have a DIY super fund or complex tax arrangements, such as owning shares and managed funds that would attract capital gains tax; could need or already have a trust; own a business; or may not want to provide for someone who would usually expect to inherit from their estate.

Our experts

Dr John de Groot, BA LLB PhD, Special Counsel, is Chairman of the Queensland Law Society’s Succession Law Committee and of its Advisory Committee on Specialist Accreditation (Succession Law). He is also an adjunct Professor of law T. C. Beirne School of Law at the University of Queensland.

Russell Robertson has been an accredited Wills & Estates Specialist for 16 years, and is a member of the Law Institute of Victoria’s Probate, Wills and Administration Committee. Russell is an instructor at the Leo Cussen Institute and makes presentations organised by the Law Institute of Victoria.

Even if you disinherit immediate family members or dependants, they may still be able to contest your will. CHOICE spoke with Gerard Malouf Partners, which has dealt with a case of three adult children of a farmer who left all his assets – total value $525,000, including the family home – to two charities. Subsequently, his children contested the will and eventually achieved a settlement of $300,000.
Your spouse, children, de facto partner, any dependants or former spouse can usually contest your will. They would normally need to convince the court that you have failed to make adequate provisions for their maintenance, education or advancement in life.
But there is no moral duty to bequest money to all your usual heirs. In a recent case, a father distributed his assets equally between his children except his eldest son, who was left out altogether. The eldest son contested the will, claiming it was his father’s moral duty to provide for him. This claim was rejected by the High Court, which did not see “moral duty” as a defining element of the relevant legislation.

What happens if you don’t make a will?

If you die without a will, your assets are divided according to legislation that differs between states. In SA, for example, your spouse would receive your personal assets, the first $100,000 of your estate and half of the remainder, with the rest divided among your children in equal shares. In NSW, however, your spouse is entitled to your whole estate.

State legislation also differs in the case of de facto spouses. They are usually only accepted as your spouse if you have lived together for two or more years.

Estate planning

A will is only part of a comprehensive estate plan. Estate planning means passing on all your assets to your dependants in the most tax-effective and financially beneficial way. It considers assets bequeathed in your will as well as beyond its scope, such as superannuation. It also considers other important issues, such as appointing a guardian or establishing a trust to take care of the future needs of any dependent children, should you and your partner both die unexpectedly.  

Case study : Will 'null and void'

CHOICE staff member Joe Sydney was the executor of his father’s estate. Joe’s father received legal advice when preparing the will, but handled signing and storage himself. Joe SydneyJoe discovered the will was incorrectly signed, as his father had come to the first witness with the will already signed and afterwards went to the second witness. Joe’s solicitor told him a court may consider the will “null and void”, as it needed to be signed in the presence of the two witnesses at the same time.

The main beneficiaries of the will were Joe, his stepmother, sister and his father’s silblings. Joe’s mother, his father’s first wife, was not included. Before he appealed to the court to grant probate, Joe got written statements from all beneficiaries, as well as his mother, promising they wouldn’t contest the will.

While the rules differ in different states, there are some common aspects:

  • Usually you must be 18 years old or already married The will must be in writing, and you must have testamentary capacity. This essentially means you must be of sound mind and understand the implications of making a will, what assets you have and who your usual beneficiaries would be.
  • Be clear about anyone mentioned in your will Rather than simply writing “my spouse”, state their full name. Ordinary wording and everyday terms do not necessarily have the same meaning in law, which can be quite specific and precise. Ambiguous wording is extremely common in homemade wills, which may result in substantial costs and delay, so it’s always a good idea to get legal advice when preparing your will. This can cost anywhere between $200 and $1000, so shop around.
  • Your will must be signed in the presence of two independent witnesses In some states, the witnesses cannot be beneficiaries or the spouse of a beneficiary, otherwise they may lose their inheritance.
  • Appoint an executor The executor’s duties include not only distributing your assets according to your wishes, but also applying to the Supreme Court for probate – a formal document that gives the executor permission to administer your estate, lodge a tax return and establish any trusts (such as bequests given to young children). This can be quite onerous and time-consuming, so check they’re willing to do the job and ensure you appointing a substitute executor if your first choice is unable or unwilling. Another option is to appoint a solicitor or trustee company as your executor.
  • Update your will when your circumstances change Starting a de facto relationship (with someone of either the same or opposite sex), marriage, separation or divorce, having a baby or your executor becoming unavailable are common examples of changing circumstances. If one of your beneficiaries dies, part of your will may no longer be valid and the gift you leave to them may instead be distributed according to state government rules – so it’s important to name substitute beneficiaries in your will. Another reason to keep updating is that the value of certain assets, such as shares, may change over time,  so you might want to check your assets are still distributed fairly. As a rule of thumb, you should review and update your will every five years.
  • Keep your will in a safe place where it can be found “If it can’t be found and was in possession of the will-maker, the law assumes it has been destroyed by the will-maker with the intention of revoking it,” says our expert, Dr John de Groot. Thus, making sure your executor knows where your will can be found can prevent problems later on.

Super traps

Superannuation can make up a large part of your assets, particularly if you‘ve taken out life insurance through your super fund. However, you may only have limited control over how the money will be distributed should you die. The person who receives your super money is determined by the trustee of your super fund, and is usually a dependant, such as your spouse and/or children, otherwise it goes towards your estate.
Some (but not all) super funds accept a “binding nomination”, which gives you certainty on who receives how much. You must update a binding nomination every three years, otherwise it goes out of date. You can usually only nominate a financial dependant – your spouse, children or alternatively your estate – as the beneficiary. The tax treatment for super money differs depending on the beneficiary. While financial dependants and your spouse receive the money tax-free, non-dependent beneficiaries, such as adult children, may have to pay tax.

Public trustee services

Public trustees were originally established to look after deceased estates where there was no will and no relatives. Today they still offer these services, plus they can also help you make your own will and store it securely.
Although public trustee will-making costs are competitive or free, they usually request to be the executor of your estate. Charges for this service differ depending on the state you live in, but range up to a commission of 5.5% of the value of your estate in the case of the Victorian Public Trustee. This may work out to be expensive if your estate is straightforward. However, in complicated cases, such as when trusts are being established for funds inherited by young children and there are a number of complicated taxation issues to resolve, the fees can be very competitive. In some states, public trustees charge an hourly rate rather than commission for administration costs. Public trustees also offer trust administration services and can look after your affairs if you become incapacitated and give them an enduring power of attorney.
Public trustees are state government agencies; you can find their contact details in the phone book or by searching on the Australian Government website. 

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