Estate planning can be as simple or as complex as your portfolio of investments and assets. It is important that your personal and financial affairs are in order so that executors and beneficiaries are left with clear instructions for accurately enacting your wishes for the distribution of your estate.

Here are three things you can do right now to start getting your affairs in order:

1. WRITE A WILL OR DEVELOP AN ESTATE PLAN

This is the easiest step but the most overlooked. An estimated 50 per cent of Australians die without a will, which creates problems for loved ones left behind.

Without a will, your assets will be distributed based on the laws of the state or territory you live in and may go to family members you are estranged from.

If you own assets jointly or if there is any dispute between your beneficiaries after you’ve gone, much of your estate may disappear in legal fees.

If you jointly own a business, a will is crucial. In fact, all partners should ensure that each has a will so that the business can continue if one partner dies. A will is also vital if you are the sole director and shareholder of a business. Without it, your family may be tied up in legal wrangles to take control of the business or, if there are no close family members, the Public Trustee may take control. Either way, it’s likely the business will be forced to close until the legal issues are resolved.

A will or estate plan is a dynamic document and should never be put in a drawer and forgotten about. It should be reviewed annually to ensure it is still current and reflective of your wishes and objectives. It may not need amending regularly but it should, at the very least, be reviewed. A quick annual review will ensure that there are no surprises after you have gone.

2. THINK ABOUT LIFE INSURANCE

Life insurance helps to provide financial security for your family when something happens to you. For example, it could:

• pay out an existing mortgage on the family home;
• provide for future education costs, or
• provide capital to allow the surviving spouse to amend their work commitments to spend more time with the family.

Life and disability insurance cover can be purchased through your superannuation fund and is sometimes provided by default, for a fee. There are advantages for some people to buy life insurance through their super fund, but for others there can be disadvantages. Talk to your financial adviser to discuss the most suitable insurance solution to meet your needs.

Protecting your future income via income protection or trauma insurance should also be factored in.

3. CHECK YOUR SUPER DETAILS

Your superannuation balance does not automatically form part of your estate and is not covered by your will. Your superannuation fund will decide who receives your death benefit, unless you let them know your preference.

There are different ways to do this. A ‘non-binding nomination’ gives the super fund trustee a guide when distributing your benefits, but a ‘binding nomination’ legally requires the trustee to pay to the person or people you name.

These nominations are vitally important to ensure that your assets transfer to the right people should it become necessary

These three simple steps will help to protect your family and will begin to ensure your wishes are carried out when you die. Once you have covered these initial bases, it is also worth considering more complex estate planning factors such as testamentary trusts and appointing an enduring power of attorney. As state-based requirements for these legal instruments differ, it is important to seek advice from an appropriately qualified legal professional on these and other issues when you are ready to take a more comprehensive approach to your estate planning.