Retirement
How can I transfer my wealth before death?
While having a well-considered and properly drawn up estate plan is a necessity for everyone with assets, you don’t have to wait until you die before distributing your wealth.

How can I transfer my wealth before death?
While having a well-considered and properly drawn up estate plan is a necessity for everyone with assets, you don’t have to wait until you die before distributing your wealth.

You may decide to pass on your wealth while you’re alive, but such a strategy should always be carefully considered and is dependent on your individual circumstances.
Australians median age is rising, therefore, longevity is an important consideration. Will you have enough capital and income to sustain you throughout your lifetime and have sufficient remaining to pass on the desired legacy? Consider, if you live longer, and your medical and aged care costs are higher than anticipated, how will you fund your ongoing living expenses, and whether you can afford to pass on your assets while you are alive.
Relocating to an aged care facility
Recently, a client and her husband relocated to aged care homes. In this particular case, the client had remarried later in life and both she and her husband had grown children. Sadly, a short time later, my client’s husband passed away. At that time, the marital home that was owned as tenants in common was sold and my client received her share of sale proceeds. As my client is a self-funded retiree paying ‘full freight’ for her accommodation and care costs, she has decided that after setting aside enough for her needs during her lifetime, she will pass on her remaining assets now while she is alive. She intends to pass the cash from the sale of the home and the sale of her share portfolio to her four children.
If you do decide to give away assets inter vivos and you are the recipient of Centrelink or Veterans Affairs pensions (or likely to be), gifting your assets above established limits will mean that deprivation rules are applied to any benefits received. That means those assets are counted as belonging to you and this may negatively affect your pension and aged care entitlements. The time frame for deprivation is five years.
In some circumstances, beneficiaries may be ‘at risk’ and in that case, your asset protection strategy may be to pass those assets into a trust.
There may also be costs involved in the transfer, such as capital gains tax and stamp duty. You should also consider the tax and other implications for the beneficiaries of your gift. Make sure you speak to your solicitor, tax adviser, accountant and/or Centrelink before making any decisions.
Generally, key steps in deciding on an inter vivos intergenerational wealth transfer (in other words, giving away your assets while you are living) include determining that your needs can be adequately met in your lifetime, open communication among family and possible beneficiaries, determining what assets will be transferred at what time and to whom and any structures that may be required. Ensuring your estate plan is relevant and up-to-date and the use of testamentary trusts, if required, remain important.
Wanting to help the kids
Another Omniwealth client who is widowed, retired and living comfortably but modestly on the coast in a caravan, enjoying the sun, sustained by her superannuation pension, also wanted to help out the kids. In this case, the client has substantial assets well beyond what she believes she needs in her lifetime and therefore came to us for advice on how to have a sustainable income stream yet pass on assets in the most efficient way possible.
The client has three children and two investment properties two of the children were living in. The outcome of the advice was to assist two of the children to purchase those properties using a combination of vendor and bank finance; and with the capital raised provide a loan to the third child to purchase a home. In this case, the children would not have otherwise been able to purchase homes for many years requiring substantial savings for deposits. The vendor loans provided an income stream to our client and upon her death, the outstanding balance on the loans is to be gifted to the respective child.
Conclusion
The benefit of a sound plan to transfer your wealth is that the assets pass to the desired beneficiary in a way that protects their ultimate financial interest. If substantial assets are to be transferred, either in your lifetime or after, it is important to ensure that the custodians of that wealth you have spent a lifetime building can manage it effectively and enduringly for their benefit and your future generations.
Genene Wilson, senior financial planner, Omniwealth

Retirement Planning
Retirement time bomb requires complex thinking
The majority of Australia’s super assets now sit in the hands of retirees and pre-retirees, but many require more nuanced investment strategies to achieve the lifestyle they want in retirement, a ne...Read more

Retirement Planning
Why some Millennials are struggling to save for retirement
Millennials are struggling to save for retirement as they face challenges that are different from other generations. What are these reasons? ...Read more

Retirement Planning
Retirement Income Review cornerstone ‘not for everyone’
Despite being the cornerstone of the Retirement Income Review, an expert has highlighted that downsizing and withdrawing equity from a property might not be the solution for all older Australians. ...Read more

Retirement Planning
Effective tips that can help Millennials retire faster
Millennials have changed the cultural and societal landscapes of the world. This is unsurprising, given the fact that they are the best educated and most diverse generation in history. ...Read more

Retirement Planning
What you need to know to get ahead financially
Australians looking to get ahead are being advised to analyse their financial situation, set financial goals and reduce debt whenever possible. ...Read more

Retirement Planning
How to adjust your wealth strategy during COVID
Investors are being urged to be conservative about spending, reduce debt and be careful of assets that are supported by government spending, as they look to adjust their wealth strategies during the f...Read more

Retirement Planning
Should older Australians downsize their property?
Older Australians face the dilemma of not being confident about their retirement outcomes, but are among the wealthiest retirees in the world due to a large proportion of their wealth being tied up i...Read more

Retirement Planning
Self-funded retirees ‘hung out to dry’ by 2020 budget
The Association of Independent Retirees has slammed last night’s federal budget release, accusing the government of overlooking older Australians in its post-COVID-19 recovery plans. ...Read more

Retirement Planning
Retirement time bomb requires complex thinking
The majority of Australia’s super assets now sit in the hands of retirees and pre-retirees, but many require more nuanced investment strategies to achieve the lifestyle they want in retirement, a ne...Read more

Retirement Planning
Why some Millennials are struggling to save for retirement
Millennials are struggling to save for retirement as they face challenges that are different from other generations. What are these reasons? ...Read more

Retirement Planning
Retirement Income Review cornerstone ‘not for everyone’
Despite being the cornerstone of the Retirement Income Review, an expert has highlighted that downsizing and withdrawing equity from a property might not be the solution for all older Australians. ...Read more

Retirement Planning
Effective tips that can help Millennials retire faster
Millennials have changed the cultural and societal landscapes of the world. This is unsurprising, given the fact that they are the best educated and most diverse generation in history. ...Read more

Retirement Planning
What you need to know to get ahead financially
Australians looking to get ahead are being advised to analyse their financial situation, set financial goals and reduce debt whenever possible. ...Read more

Retirement Planning
How to adjust your wealth strategy during COVID
Investors are being urged to be conservative about spending, reduce debt and be careful of assets that are supported by government spending, as they look to adjust their wealth strategies during the f...Read more

Retirement Planning
Should older Australians downsize their property?
Older Australians face the dilemma of not being confident about their retirement outcomes, but are among the wealthiest retirees in the world due to a large proportion of their wealth being tied up i...Read more

Retirement Planning
Self-funded retirees ‘hung out to dry’ by 2020 budget
The Association of Independent Retirees has slammed last night’s federal budget release, accusing the government of overlooking older Australians in its post-COVID-19 recovery plans. ...Read more