SO YOU’RE GETTING DIVORCED ….

Back to News
Estate Planning

torn piece of paper with divorce text and paper couple figures

DIVORCE

Well, it’s happens to lots of marriages these days. Half in fact. Staggering numbers but it is reality.

Through the divorce process you may have forgotten about your superannuation and insurance beneficiaries. Or you made a knee-jerk change to your beneficiaries. “If I go, he’s not getting my insurance policymoney!” You certainly wouldn’t be alone in this thought – in fact, it’s the exact decision most people make! Or you might have even cancelled your policy.

There is no wrong or right in this situation, but there are things to consider.

Most people make their children the beneficiary. This is fine, providing you have an up-to-date will that will establish how the money is to be dealt with. Establishing a trust for the children is good, however a contingency needs to be considered that this trust money can be withdrawn to maintain living standards or education in the future. The last thing you want is to leave your benefit payment to your children and them not be able to access any of it until a certain age.

Example: your will states the children get access to their funds at age 21. Great idea, right? They’ll be sensible by then and won’t waste it. But what if they want to study when they finish high school? They’re only 18 then. It would make sense that they can draw on those funds immediately if it’s required. This needs to be written into the will.

Another alternative is trusting in your ex-spouse to make the right decisions for your children, therefore leaving them as the beneficiary. This does pose some risk though in the event that your ex enters another relationship, and can get further complicated if that new partner also has children. No one wants part of your children’s money going to your ex-spouses new step child!

A third consideration is that you can take out an insurance policy on your ex-spouse (that you pay for), assuming the spouse agrees to the application. This is another way to protect yourself and your children if you’re unsure of your ex’s beneficiary nominations and structure.

It’s a minefield working out the best scenario, and it is best left to professional financial advisers if you are at all concerned.

Shannon Bennett

 

 

 

 

SHANNON BENNETT

Southern Cross Financial

Optima Partners offers support to all businesses. Whatever your requirements

For more information on how Optima Partners’ services can help your business, contact the team at info@optimapartners.com.au for a consultation.

Latest News

Cash flow crunch: SIC, GIC and super guarantee increase
Small and medium businesses could be facing a cash flow crunch in the wake of...
Planning for EOFY 2024-25
With the end of the 2024-25 financial year in sight, the time has come again...
2025 Federal Election: Key tax changes under Labor’s second term
The Australian Labor Party has declared victory in the 2025 Federal Election, establishing a second...
Sustainability reporting: ASIC urges SMEs to brace for impact
The Australian Securities and Investments Commission (ASIC) has reminded small and medium entities to be...
Key Dates: May 2025
15 May: Lodge 2024 tax returns for all entities that did not need to lodge...
Understanding business structures: tax, liability and asset protection
Your chosen business structure has massive implications for your tax liability, asset protection and cost....
New GST reporting rules for small businesses
The Australian Taxation Office (ATO) recently announced that over 3,500 small businesses will be moved...
Optima Partners to host 4th annual Perth Car Club meet
Optima Partners is proud to host Perth Car Club’s fourth annual anniversary meet-up at our...
Key Dates: April 2025
21 April: Lodgement and payment of March 2025 monthly business activity statement 21 April:...
Selling your business: Best practices
Selling your business is a major decision and a milestone in your career. Whether you’re...