There are certain people in your life who need special attention when it comes to your estate planning. These people are called vulnerable beneficiaries, and they may need extra protection in your Will for several reasons.
A vulnerable beneficiary could be:
- A child aged under 18
- A person with a disability – either physical or intellectual impairment
- Someone facing financial exploitation – for example, a person with dementia
- Someone with substance abuse issues or behavioural addictions such as compulsive gambling
It’s important to take into consideration the need to balance care with control and ensuring beneficiaries receive the help and support they need, while preventing long-term financial mismanagement.
If you have a loved one who relies on the Disability Support Pension, preserving government benefits may also be a priority. Maintaining eligibility for any pension could be critical. This could also be an issue if you have a beneficiary who receives support from the National Disability Insurance Scheme (NDIS).
There are a couple of legal options for anyone looking to protect and support vulnerable beneficiaries:
- Protective Testamentary Trust: this type of Trust is managed by someone else on behalf of the beneficiary. The beneficiary has no control over trustee appointments or how funds are distributed.
- Special disability Trust: this allows immediate family members and caregivers with the financial resources to privately pay for the care and housing of a family member with a severe disability while also receiving means test concessions. A special disability Trust allows a certain amount to be excluded from disability pension eligibility.
All Trusts come with added obligations, including appointing a Trustee, as well as tax and financial regulations.
If you need to set up a Trust as part of your estate planning, you will need expert advice and guidance.
The Wills and Estates team at Bickell & Mackenzie can help you with every aspect of your Will, including Trusts. We will ensure the people you care about most will be taken care of after your death.
To make an appointment, contact our office on: (07) 3206 8700 or email: info@bimalaw.com.au
