Death. Nobody likes to think about their own demise, but it is 100 percent guaranteed to happen to you one day and unfortunately for some it happens sooner than they expected. One of our recent cases involved a young woman who left her home one wintery afternoon to run some errands. She never made it back, instead she was fatally injured in a car accident. She had no will, and why would she? She was young, had no husband or children, and had not expected to die that afternoon. This young lady, let’s call her Amanda, had, however, planned for her future children, having taken out a life insurance policy some time earlier. Whoever it was that tidied up her affairs after her death must not have known that she had taken out life insurance, and why would they? She had not left a will. By the time Amanda’s file landed on our desk, she had been dead for several years and the money in her insurance policy was at risk of being given to the State because no one could find who her next of kin were. At this point some explanation is needed of what happens to your estate (your stuff and money) if you die without a will. There is quite a complex formula for who gets what, which I will simplify for the sake of brevity (and sanity). Basically, your first heir is your spouse, then your children. If you have no children, then your parents share your estate with your spouse. If you have no living parents, spouse or children, then it gets a little more complex. Your heirs will then be your brothers and sisters and their children, but if you have no living siblings and there are no nieces and nephews then your estate goes to your grandparents and your parents’ brothers and sisters and if they are not living, then to their children. Confusing huh? The simplest way to avoid this situation for your heirs is to make a will, and once you have done this, keep it up to date. There’s no point, for example, leaving your prized gold leaf tea set to your Aunty Betty if she died 10 years before you. It is also a good idea to keep addresses and contact details for those who are named as beneficiaries in your will, written down and stored with your important papers. Having a will helps your executors and your family know what your wishes are and usually helps avoid arguments over who gets what. While dying is probably going to be tough for you, it might be even tougher for those who you leave behind if you have not left them with instructions about what you would like to happen to your money and personal items after you have gone.
What happened in Amanda's case...
Sadly, Amanda’s death barely made the news, and unfortunately the police officers who had dealt with the case could no longer remember, who from her family they had been in touch with. Both of Amanda’s parents had died, but fortunately, from their headstone, we found out that Amanda had two siblings. Unfortunately, we only had their first names. New Zealand’s privacy laws are quite strict and finding information about people other than yourself is pretty much impossible if you don’t know where to look. The situation with Amanda’s estate is surprisingly common, and if you take a look at the IRD’s money owed website you will see a large amount of money which has come from deceased estates. In many of these the heirs have not been able to be located and in some cases the rightful heirs have no idea that they are even related to the deceased person and that they are entitled to benefit from the estate. Fortunately for Amanda’s two siblings we managed to locate contact details for them. Both were married and living overseas, and each received half of Amanda’s life insurance policy, but not without a lot of thinking outside the box and effort on the part of the team at GI.