Hypothetical by Manny Wood Published in the Coffs Coast Advocate on 5 October 2019.
Jack and Jill have been in a relationship for the last 15 years and have a blended family. Jack has two children to a previous relationship and Jill has three.
They own their home jointly and have superannuation and some savings.
They have relatively simple wills, leaving all of their assets to each other and the last survivor leaving their whole estate to all five children equally.
Jill is concerned that if she dies before Jack, he may enter into another relationship and that his new partner may end-up taking the bulk of Jack’s estate at the expense of her children.
Jack is concerned that if he dies first, Jill might change her will, leaving his children out.
They are both concerned about the potential for their wills to be challenged.
They receive legal advice and are advised of their ability to make wills that establish “flexible life interests” with a view to reaching a balance between providing properly for each other and also protecting their children’s inheritance.
The wills grant their surviving spouse the right to reside in their home for life, while preserving the capital for their children. The wills allow the surviving spouse to sell the property and purchase another property if the need arises. The wills also allow the surviving spouse to relocate to a retirement village under a lease arrangement or to move into a nursing home by way of purchasing a bond.
Upon the death of both Jack and Jill, their half interest in their home, or the substitute accommodation, as the case may be, is then inherited by their respective children equally.
Jack and Jill are advised to register the ownership of their home as tenants in common in equal shares in order to facilitate the operation of their wills.
If you would like Manny to address a particular legal issue, send your request to manny.wood@ticliblaxland.com.au or call him on (02) 6648 7487.
