Many people want to ensure that their estate goes to the right people when they die, so they make a Will to ensure that this happens. The problem is that too many of us don’t give any thought to our estate and either forget or don’t bother making a Will. So, what happens to your estate when you die without making a Will? Who benefits from your estate?
Whilst the laws are slightly different across the states and territories, here in Victoria, the following scenarios will play out if you die intestacy or without a Will.
Frozen bank accounts
When the bank is informed of your death, usually by a relative or the executor of your estate, your bank accounts are frozen. This means that no-one can access any of your money, regardless of need. The bank will need to see the informant’s ID, as well as a death certificate, but once they are convinced of your death, all accounts are frozen.
Even someone with a Power of Attorney cannot access your accounts once they have been frozen. Any direct debits or regular payments from your accounts will also be frozen. So, you can image the trouble your dependents may experience if they rely on your income to pay their bills and put food on the table. Instantly, they will no longer have access to your funds.
To help your beneficiaries actually gain access your funds after your death, you need to write a Will and include a list of all the banks where your accounts are held, as well as the account numbers.
If you have a Will, any money held in your bank accounts will be distributed according to your wishes. If you do not have a Will, then the bank can release your funds to the executor of your estate or your next of kin (on their discretion), unless the amounts are excessive, when a Grant of Probate may be required before the money can be released. All debts or credit card bills will be paid from these accounts before it is released.
The issue here is that you might not want any or all of your estate to be given to your next of kin. The only way you can make your wishes heard in this case, is to make a Will.
Paying for funeral costs
If your bank accounts are frozen, how will your family pay for your funeral? In many cases they may have their own money that can be used, but in many cases, they simply don’t have access to this type of money. So, it’s good to know that whether you make a Will or not, your bank will release the funds to pay for your funeral, if they are presented with an invoice for the funeral costs.
Writing a will
If you have not written your Will, want it updated or have any questions about planning your estate, our expert lawyers can guide you through the process, ensuring that your estate is distributed according to your wishes. Call us on 134 134.