Parents and a client’s estate planning

We note there is a common misconception that estate planning is only for the benefit of spouses and descendants. However, with the ageing population, parents now form an important part of intergenerational estate planning. Key items include managing assets owned by former generations and caring for elderly parents.

Inherit’s Legal Bot will ask you about your client's parents, according to the client’s circumstances. The Bot will collect this information that is relevant for one or a number of reasons:-

(a) if both parents are alive, it is important to understand how the parent’s wealth will pass to the client, assuming the parents pass away first. This wealth may pass directly or indirectly, such as control or partial control of assets in a trust. It might be relevant to know how that control will be managed if the client or their parent(s) subsequently pass away or lose capacity, as it may impact the client’s broader family.

(b) It is useful to understand if there are any financial relationships that exist between the client and their parents or related entities and what may happen as a consequence of the death of either a parent or the client. For example, the client may have outstanding loan accounts or unpaid present entitlement in a trust controlled by a parent. Other financial relationships may also exist, such as co-ownership of property, a company that operates a business or a granny flat agreement etc.

(c) Whether there is any dependency or interdependency between the client and their parents. Any financial dependency may give rise to a right by a parent to a family provision claim or an interest in superannuation death benefit. Other forms of dependency or interdependency may exist, such as elderly parents who occupy the same household as the client.

These circumstances will not affect all clients, but where Inherit’s legal Bot identifies a potential issue, it undertakes a line of enquiry and reports the issue in the Client Issues Report that forms part of the Inherit lawyer’s brief for the nominated lawyer to consider and address with the client and adviser