Good Estate Planning

Ideas that look good on paper… are not always ideas that work out when the rubber hits the road.

When Mr Baker* died, he was survived by his (second and fairly new) partner, Jill*, and his daughter, Simone*, from whom he had only recently reconciled.

Mr Baker had done reasonably well over his lifetime, so there was a meaningful estate to distribute. Jill received the family home, the chattels, and the bank accounts. Simone, on the other hand, was given control of Mr Baker’s Trust and the assets owned by it.

On paper, this looked generous. The Trust held several rental properties spread across the country. However, there were a few significant problems:

• None of the properties were located anywhere near where Simone lived.

• Not all of the properties were generating income.

• Several were in desperate need of maintenance.

• Some were part of managed Unit Title developments and subject to strict Body Corporate rules, levies, and oversight.

Compounding matters, Mr Baker had never properly separated his personal finances from the Trust’s. Trust income landed in his personal bank accounts, and personal funds were frequently used to pay Trust bills. There was a constant cycle of borrowing from Peter to pay Paul.

When he died, all of his cash was held in his personal name and therefore fell into his estate—not into the Trust. This created immediate confusion about the relationship between his personal affairs and the Trust, and caused delays in administering his estate.

The consequence? Many Trust bills went unpaid. By the time Simone formally took control, the Trust was drowning under unpaid rates, insurance premiums, and Body Corporate levies. The Trust had no cash left. And Simone—whose own financial position had never been comfortable—did not have the means to rescue it.

On paper, Mr Baker appeared to have left his daughter a modest property empire.

In reality, Simone inherited something closer to a nightmare: bad debts, baying creditors, and impenetrable bureaucracy.

Good estate planning isn’t just about passing on assets. It’s about passing on stability and clarity.

1. Keeping Trust and Personal Finances Separate

   Clear separation ensures that when the time comes, trustees can step in seamlessly. Proper records, dedicated accounts, and consistent treatment of income and expenses prevent confusion and delay.
   

2. Ensuring the Trust Had Sufficient Liquidity Owning multiple properties means nothing if there’s no cash available to pay the bills. A considered estate plan would have ensured the Trust had access to cash reserves to cover rates, insurance, repairs, and Body Corporate levies.
   

3. Selecting the Right People for the Right Roles Leaving a portfolio of properties to someone who lacks the financial resources—or the geographic proximity—to manage them is almost always a recipe for stress. Good planning matches responsibility with capacity, interest, and practical ability.
   

4. Reviewing the Structure Regularly Life changes. Relationships change. Financial circumstances change. A Trust or estate plan that isn’t reviewed can drift far from what works best in practice.

   
   

5. Coordinating the Will, the Trust, and Personal Assets The Will, the Trust deed, the ownership structure, the bank accounts, and the intended outcomes all need to speak to each other. When they don’t, assets end up in the wrong place at the wrong time—and beneficiaries pay the price.

If you want to make sure your loved ones inherit the benefit of your hard work—not the burden—now is the time to get your affairs in order. Get in touch and let’s put a plan in place that actually works in the real world, not just on paper.

* Specific circumstances/names provided by way of example.