Danielle Phillips an only child and the Founder of Sage, realised the importance of an executor solution to provide support to a deceased person’s family and Executor of the will, when she lost both of her parents at the age of 35 during the Covid-19 pandemic.

After countless hours of being placed on hold, weeks of following up paperwork and often being given the wrong documentation to complete, Danielle immediately recognised the need for a roadmap that could effectively lessen the pressure and confusion around deceased estate administration and what to do next when someone dies.

For Danielle, the process of helping clients during such a difficult time is more than just a business, it’s personal.

The palliative care journey can be one of the most mentally, physically and emotionally exhausting experiences of a person and their family’s life. The end of this journey often is the start of a complex administration process for loved ones left behind.

But there are things you can do ahead of time to make things easier down the track. This would mean less time trying to find and sort out paperwork and allow more space and capacity to grieve.

During the process of managing my parents’ deceased estate, I took inventory of all the items that I had to cover off. From closing utility accounts, to mail redirections, I ended up with a list of 40+ items to action.

Did You Know?

It takes the average Executor in Australia 200 - 300 hours to fully administer an estate. This equates to up to 6 hours per week depending on how much time you are able to allocate to the process. 

Most of this time is spent trying to locate and complete paperwork to close bank accounts, cancel direct debit payments and getting documents certified. However, getting one’s affairs in order, leaving documents in one place, and having conversations with the person who will have to manage it all, can reduce the time and burden. Alternatively, outsourcing these key processes can reduce a 12 month process down to as little as 3 months. There are companies who provide this service for a fee.

Having conversations early around the paperwork and processes that may be required during the after-death administration process, can significantly minimise the impact and mental load for loved ones that are tasked with administering a deceased estate. Do you know the whereabouts of documents such as birth and marriage certificates as well as knowledge of bank accounts, passwords and the location of a Will?

Some of the top conversations that we need to start having with each other at the end of life (or earlier if possible), are around the following topics;

• Is there a Will or last testament in place? 

A valid and up to date Will ensures that your estate is managed by a person you trust and your wishes are carried out. It also reduces the cost of settling the estate and time it takes. This article best articulates the reasons to have a Will in place and what the Will informs once someone has passed away. There are companies that can assist with the preparation of a Will and some also provide an online portal where you can upload and securely store all of your relevant personal and identification documents for a small annual fee. These documents include drivers’ licences, bank details, superannuation details, funeral wishes, Power of Attorney documents and just about anything that you will need to access over the course of dealing with someone’s deceased estate.

Without a valid Will, it will make it more frustrating and difficult for your family to sort out your affairs. Government departments and major organisations (e.g. banks, superannuation funds) rely on formalised documents and everything becomes harder and slower without them. 

• Have you considered the tax implications for a spouse or beneficiaries when it comes to inheriting funds or a superannuation benefit?

When someone passes away who has a superannuation account, the tax implications for a death benefit paid to a beneficiary who is not a legal spouse can vary based on several factors. Non-spouse beneficiaries may include children, dependents, or other individuals. The tax treatment differs depending on the relationship to the deceased.

If the death benefit is paid as a lump sum to a non-spouse, it is generally taxed. The taxable portion may be subject to a tax rate of up to 15% plus the Medicare levy, depending on the age of the deceased.

There may be instances where a spouse is the eligible beneficiary, however is receiving a pension or Centrelink entitlement, and if a lump sum is paid, it could significantly reduce or even wipe out the pension. This also applies to anyone receiving a benefit or inheritance from the deceased estate, so it’s best to get independent financial advice before the funds hit your account.

• Are there clear records of bank accounts, social media accounts, shareholdings, insurance policies, licences and registrations?

When it comes into stepping in as an Executor, Next of Kin or Administrator of a deceased estate, it can be extremely time consuming to locate assets, accounts and memberships in order to transfer or cancel these. Having these details on hand, ideally put together before the person dies, will allow you to act more efficiently as a custodian of your loved one and significantly reduce the time it takes to expedite these processes.

Having a copy of any property titles can mean that the way a property is dealt with when a person passes away is more direct. This is determined by the title type; joint tenants, tenants in common or sole owner.

The other common items that are often overlooked are, notification to the Australian Electoral Commission and updating home insurers. Many home insurers wont honour a claim if they do not have up to date information such as the property being vacant and now part of a deceased estate.

It is also important to cancel identification documents such as drivers’ licences’, notify banks and close social media accounts, to reduce the risk of identify fraud.

• Do you know the legal outcomes of administering a deceased estate?

Aside from the probability that a final tax lodgement will need to be done for the deceased individual and the deceased estate, there is also the matter of Probate, which many people don’t know about or overlook. In any estate where property exists there will always need to be a Grant of Probate issued by the court before the Property can be sold or leased. If you have placed a refundable accommodation deposit with your aged care provider you will almost always need a Grant of Probate for this to be refunded.

You may need to allow up to $10,000 for this process depending on the complexity of the estate, and getting legal advice around this when preparing your Will is prudent.

In summary, the attitude for many may be “Once I’m gone, I don’t need to worry about my affairs” but it’s the people left behind that are faced with not just grief, but are having to navigate a myriad of processes whilst blindfolded. A little bit of preparation earlier to ensure that important documents and information can be easily accessed by the relevant person will make it a lot easier.

Free consultation

Danielle is offering a no obligation consultation to anyone wishing to have a conversation around all things “when a person dies” which can be had either before or soon after someone has passed away. You can learn more about the 40+ items that can be included for discussion during these sensitive conversations at www.sageexecutorsolutions.com.au