Asset Protection in Mature Relationships
As legal professionals, we often counsel mature parties entering into new relationships later in life, bringing a wealth of experience and sometimes complex personal histories.
Typically, each individual has accumulated assets, and it’s not uncommon for one or both to have adult children from previous relationships. They are keen on asset protection, aiming to safeguard certain assets for their children while also desiring to protect assets from divorce and jointly acquire new assets with their new partner.
It’s common for such couples to establish an asset protection trust or enter into pre-nuptial financial agreements. These measures are designed to preserve their individual assets for their children in the event of a separation, ensuring trust asset protection while sharing only specified assets with their new partner.
As family lawyers, we meticulously plan for potential mature relationship break downs and the subsequent estate division, but we also consider the implications of wills and estates if a party passes away within an intact relationship. Each partner grants the other certain rights upon death, which are significantly amplified if a party dies intestate, potentially affecting family provision.
Furthermore, if a party in an intact mature relationship passes away leaving a Will that excludes the surviving partner, the latter may become a vulnerable beneficiary with the right to claim testamentary trust benefits for a share of the estate.
So it is vitally important that, if you are entering into a new mature relationship, you should give consideration to what will occur to your estate in the event you pass away. You may wish to make some provision for your new partner in your Will, whilst leaving the bulk of your estate to your children, particularly if your ‘new’ relationship is a lengthy one. You should also make sure to update the beneficiaries on your super funds and life insurance policies so as to ensure the wrong person does not receive a significant sum after your death.
Issues involving relationships between older couples can and do raise fascinating legal issues, including:
- Whether the parties are in a relationship or not
- Whether the parties can enter into a financial agreement (pre-nup)
- Whether the parties can understand the legal practitioner’s advice
- When and how separation might occur if one party goes into aged care
- Whether a party who has lost capacity can invoke the terms of a financial agreement
- How contributions might be assessed in such shorter relationships
- When future needs factors are relevant,
- The intersection with testamentary considerations.
Our family lawyers and estate planning lawyers work in tandem to make sure your legal document complement each other. Call us on 4651 4800.
