When did you last review your will, your power of attorney ("POA") and your appointment of enduring guardian ("EG") documents?
Generally, we recommend you review these documents every 5 years. However, there are certain changes of circumstances that should prompt you to review these documents as soon as possible and which may even require you to create new documents.
These changes include:
- Marriage automatically revokes a will, unless the will was made in contemplation of marriage. After you marry, you should make a new will.
- Your POA is not revoked by marriage. If your POA was signed before your marriage it is still effective. However, if, for example, your POA appointed your former spouse, you may wish to formally revoke the POA and make a new POA appointing another person as your attorney.
- Your appointment of an EG is revoked on marriage even if you appointed your current spouse as your EG. After marriage, you need to sign a new appointment of EG document.
- Unlike marriage, separation does not affect the validity of your will. As a result, there have been several cases where a couple have separated, one spouse has died after separation but before the divorce and their former spouse has been entitled to the whole of their estate either due to their failure to update their will after separating or by not having any will in place at all and the rules of intestacy applying in favour of their former spouse.
- Similarly, your POA and EG documents will not be affected by separation. You should consider whether you need to revoke the existing appointments and make a new POA and appoint a new EG after separating
- Divorce only revokes or cancels any gift made in your will to your former spouse. It also cancels your spouse's appointment as executor, trustee or guardian in your will. It does not cancel the appointment of your former spouse as trustee of property left on trust for beneficiaries that include the children of you and your former spouse. However this will not apply if the Court is satisfied you did not intend to revoke the gift or the appointment by the divorce. Instead of leaving these matters to the Court, if you have not made a new will after separating, it is imperative that you make a new will as soon as possible after your divorce.
- Divorce does not revoke your POA or EG documents appointing your former spouse. In order to cancel these appointments, you need to sign a revocation and serve it on your former spouse.
- Birth of an additional beneficiary. This is likely to necessitate a change to an existing will
- Death of a spouse, an existing beneficiary, your executor, your attorney or your EG.
- A change to the needs of your children or grandchildren
- A material change in your financial circumstances.
- A breakdown in a relationship with relatives or friends who you may have appointed as:
- the executors of your estate;
- beneficiaries under your will;
- guardians of your minor children; and/or
- your attorney or your EG
- The decline in health or some other change of circumstances (eg bankruptcy) so that, for example, a beneficiary under your will may no longer be able to manage their own finances, or the person you appointed as your executor, your attorney or your EG may no longer be suitable or capable of administering your estate or managing your affairs or making personal decisions for you.
- Retirement often results in people restructuring their affairs. This is an ideal time to be proactive in your estate planning and possibly consider setting up tax effective arrangements through your will that you have not done previously.
When any of these events occur, you should review your estate planning documents and, if necessary, create new documents taking into account the relevant change of circumstances.