Crossing the Threshold - Why You Need a Will Sooner Than You Think
If you’re sitting at home thinking that you don’t need a Will because you don’t have enough assets to bother, it might be time to reconsider that thought.
To most Kiwis’ surprise, if you have more than $15,000 in assets you’ve crossed a legal threshold in New Zealand that requires formal administration (probate) of your assets in order for them to be distributed according to your wishes.
But what’s considered an asset and how do you know if you’ve crossed that threshold? In this blog, we’re going to walk you through examples of what is considered an asset by the government, what happens if you don’t have a Will at the time of passing and why your age does not determine the relevance of creating a Will.
What is considered an asset?
More often than not, when we’re talking to individuals about writing their Will, the first thing that comes to mind is, “I don’t need one, I don’t have much to leave behind.” While this may seem the case, it’s actually the most common misconception when it comes to protecting your loved ones after you pass.
At the age of just 25, you’ve been alive for more than 9,000 days! That’s a lot of time to accumulate ‘stuff’! Just take a look around your home and you’ll probably be surprised at just how much you have.
When calculating your total assets, it’s important to include all forms of assets that have a direct monetary value associated. For example: if you own a car, that is considered an asset because we are able to associate a monetary value to the value of the vehicle.
Other examples of assets include:
Cash (cash on hand and savings/chequing accounts)
Investments (shares, cryptocurrency, term-deposits, KiwiSaver)
Real Estate (houses and land)
Life Insurance Policies
Personal Belongings (boats, cars, jewellery, collectible items)
Business Ownerships / Equity
Don’t forget to include overseas assets that are held in your name. These still count!
As you go through the process of collating the total value of your assets, once you cross over the value of NZ$15,000, it’s important to remember that you have now crossed the legal threshold in Aotearoa and in order for your wishes to be upheld how you want - you’ll need a Will in place.
What happens if you have no Will at the time of passing?
If you have crossed this threshold and don’t have a Will in place at the time of passing, New Zealand law takes over and controls how your estate will be distributed based on the Administration Act 1969.
In one of our previous blogs, we shared some important information about what happens to your assets if you don’t have a Will in place.
Why age isn’t a determining factor
Having a valid Will in place is the most effective way in having your wishes followed after you pass.
According to a 2018 survey by Stats New Zealand, the average net worth of a 25-34 year old in New Zealand was $81,000. However, it’s estimated that 74% of Kiwis in the same age bracket don’t have a Will!
So, whether you’re 25 or 65, your age should not be a determining factor in whether or not you produce a Will, but instead, your total asset value should.
Write (or update) your Will with Footprint
Writing a Will and keeping it relevant and up to date is simple with Footprint’s online Will platform. On the anniversary of a subscription, you will receive an email notifying you that you have a Will update available. This cost is accounted for in a subscription, so there’s no additional cost unless you want to update it before the year is up. Plus, this once-a-year update can be used at any time!
With Footprint, keeping your Will updated with any new life changes is a piece of cake. Browse our Will packages online or get in touch and ask our team about our products today!
