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To share a Life Benefit rather than a Death Benefit?

Updated: Sep 4, 2018

Stacy Barnes: "More and more often I have clients saying they'd rather see their inheritance go to their children during their lifetime, asking how much they can afford to split now so they can achieve this and still have the means to fulfil the remainder of their natural life comfortably... why wait till you're 6ft under?"

Share while you're here

As mentioned in a previous article...

“The ‘super death tax’ only applies when a person dies with money in superannuation. Those who have met a full condition of release and withdraw super prior to dying but after reaching age 60, will be able to take those withdrawals into their hands tax free... Then pass on..."

What are the advantages of this strategy other than tax?

Well, you get to see your wealth transition to the next generation, see your Death benefit play out whilst you're alive, move money out of your own name early, which means less in your estate should it be contested. Other bonuses could be helping your children/beneficiaries clear debts, add funds to their super, boost a business project, pay for grandchildren's university/schooling. Some people also may wish to support a local charity, (tax benefits while your alive could also help smooth your tax position).

What do we consider prior deciding to make a life benefit?

  • Your Life expectancy

  • Budget, lifestyle expenses, future plans & expenses.

  • Accommodation needs including residential care, nursing or granny flat alternatives & downsizing options.

  • How much do we want to split and how, be it into super funds, trusts, direct etc.

  • Taxation implication of split including CGT & Beneficiaries circumstances.

  • Alteration/maintenance to Wills & estate planning post life split.

  • Many other non financial variables depending on your personal circumstances.

Food for thought

There is a bucket of thought needed if this is the path you wish to go down, however with the right planning and considerations we can work with you to design your ideal split, you're comfortable with, without compromising your future lifestyle needs.

Contact us to get started.

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