Does My Spouse Automatically Inherit Everything When I Die?

Spouse automatically inherit

Does My Spouse Automatically Inherit Everything When I Die?

 

Many people who are preparing their will or thinking about what will happen after they die often approach a lawyer, with the question ‘Does my spouse automatically inherit everything when I die?’.

The answer to this question is not always straightforward. It depends on several factors, like whether you have a valid will that names your spouse as the beneficiary, who else may have claims to your estate and in what state you live.

More importantly, if you do want your spouse to inherit everything when you die, there are concrete steps you can take to guarantee your wishes will be carried out when you pass away.

In the current climate, more than ever before, it is essential that you create a will following all the relevant legal requirements to ensure your loved ones are looked after when you pass away.

 

What Happens if You Die Without a Will in NSW

 

If you die without a valid will in NSW, you die as an intestate. When this happens, your assets will be distributed according to the rules of intestacy as defined in the Succession Act 2006. The rules in the succession act are very specific. They are subject to any person who may seek a family provision from your estate.

Whether you die with or without a valid will, it is important to note that the first people to be paid from your estate will be creditors or any other people you owe money too.

This includes:

  • Funeral expenses
  • Taxes
  • Debts to any financial institutions or other lenders
  • Any outstanding administrative or legal expenses

If you die without a will (intestate) in NSW, the general order of inheritance is as follows:

  1. Spouse
  2. Children and grandchildren
  3. Parents
  4. Siblings
  5. Grandparents
  6. Aunts and uncles
  7. Cousins
  8. The state

 

What Will My Spouse Automatically Inherit

However, these are only general principles, and the following rules are applicable when determining whether or not your surviving spouse is entitled to everything when you die:

  • If you are in a marriage or de-facto relationship at the time of your death, your partner will have priority over other family members for the majority share of your assets
  • If you leave behind a spouse and you have no children from either your current or previous relationship, your spouse is entitled to the entirety of your estate (after any debts are settled)
  • If you leave a spouse with whom you have children, the spouse is again entitled to the whole estate
  • If you have children with somebody other than your current spouse, your current spouse will be entitled to your personal effects, a statutory legacy which is calculated based on the consumer price index, and half of whatever is remaining. Your children will be entitled to the other half.
  • In the event you die without a spouse, each of your children will be entitled to an equal share of your estate.

It is important to note that these principles only apply if you die without a valid will. Otherwise, you can create a will that stipulates precisely how you would like your assets divided after your death. In doing so, you must follow all the necessary steps to ensure you will is legal and valid.

 

 Ensuring Your Will Is Valid

 

To make a legal and valid will that protects and provides for your spouse, you must fulfil specific criteria.

For your will to be considered valid:

  • You must be 18 years or older
  • It must be in writing: either handwritten or typed
  • It must be signed by you and two witnesses who are not named in the will to receive any entitlements
  • You must have testamentary capacity

 

Spouse automatically inherit

What is Testamentary Capacity?

 

For a will to be valid in Australia upon someone’s death, the deceased must be deemed to have had testamentary capacity at the time of making the will.

In the landmark case of Banks, Cockburn CJ stated that it was ‘essential’ that a testator should: ‘understand the extent of the property of which he is disposing; shall be able to comprehend and appreciate the claims to which he ought to give effect; and, with a view to the latter object, that no disorder of the mind shall poison his affections, pervert his sense of right, or prevent the exercise of his natural faculties – that no insane delusion shall influence his will in disposing of his property and bring about a disposal of it which, if the mind had been sound, would not have been made. … If the human instincts and affections, or the moral sense, become perverted by mental disease; if insane suspicion, or aversion, take the place of natural affection; if reason and judgment are lost, and the mind becomes a prey to insane delusions calculated to interfere with and disturb its functions, and to lead to a testamentary disposition, due only to their baneful influence – in such a case it is obvious that the condition of the testamentary power fails, and that a will made under such circumstances ought not to stand.’

In cases where the testamentary capacity of the will-maker is brought into question after their death, a court may deem the deceased’s will to be invalid if it finds the will-maker was not of sound mind.

 

Preparing to Write a Will

 

Before you begin writing your will, look at some sample wills online, think about your assets including any property and think carefully about who you would like them divided amongst your loved ones when you pass away.

Remember, your spouse does not automatically inherit everything.

As each state has different laws regarding Wills and Estates, it is also vital you understand the laws that relate to your jurisdiction.

Before sitting down to write your will, you should compile the following information:

  • A comprehensive list of your assets including property, stocks, bank accounts, super and any other investments
  • The current names and addresses of your beneficiaries
  • The details of your funeral (if pre-arranged), or a clear explanation of what you would like for your funeral (i.e. would you like a burial or cremation? Would you prefer it takes place at a church or funeral home?)
  • The name and details of a competent executor (or two)

It is always advisable to seek reputable advice from a lawyer experienced in Wills and Estate law to ensure you craft a will that is legal and valid and will hold up in the case of any disputes by interested parties.

 

 

 

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