In the journey of life, we often focus on building—building careers, families, wealth, and memories. Yet, an equally important aspect that many overlook is planning for what happens when our journey ends. Legacy planning isn't just for the elderly or the wealthy; it's a crucial consideration for anyone who cares about their loved ones' future well-being. It has often been said that the care for the ones left behind is displayed in the planning by the deceased.
Why Legacy Planning Matters Now
Nearly half of New Zealand adults don't have a Will, even those with dependents, assets, and liabilities. Many share the same perspective about estate planning as they do about retirement planning—"I'll deal with it when I'm older" or "I'll handle it on a rainy day." This procrastination, however, can lead to significant complications for those left behind.
When someone passes without proper documentation in place, their family not only deals with the emotional burden of loss but also faces legal and financial hurdles, and needless time delays that could have been avoided. The time to plan isn't when you're "old enough"—it's now.
The Essentials of Estate Planning
A comprehensive estate plan should include:
Wills: This legal document at its simplest outlines how you want your assets distributed and names who will serve as the executor(s) of your estate.
Enduring Power of Attorneys: These designate who will make decisions regarding your care and finances if you become incapacitated during your lifetime.
Regular Updates: Your estate plan should evolve as your life does. Major life events such as marriage, divorce, the birth of children or grandchildren, or significant changes in your financial situation should trigger a review of your estate documents.[i] Perhaps every five years or so stop and review these as a matter of course.
The Cost of Inaction
Dying without a Will—legally termed "intestacy"—has consequences that many don't consider. Your assets may not be distributed as you intend them to be if you have no Will, rather they are to be distributed by “the laws of intestacy” and Relationship Property.
If someone owns minimal assets (under $15,000 from each institution), their estate may be classified as a "small estate" and can be managed by next of kin without extensive legal processes.
However, if someone has more than $15,000 in assets or owns property, formal administration becomes legally required with the Court’s approval. This not only delays the distribution of assets but often means they're allocated according to legal standards rather than personal wishes.[ii]
Even more concerning is the potential impact on family dynamics. Ambiguity about a loved one's intentions can lead to disagreements and strained relationships during an already difficult time. Clear documentation prevents these issues and provides peace of mind for everyone involved.
Choosing the Right Executor
The executor of your Will plays a critical role in ensuring your wishes are honoured. When selecting this person (or people), consider:
Their willingness and ability to handle the responsibility
Their organisational skills and attention to detail
Their geographical proximity (someone living overseas may face practical challenges)
Their age and health relative to yours
Their relationship with beneficiaries and the other executor
Many people opt for two executors who typically must agree on decisions, providing an additional layer of oversight. Remember that this should not be a set and forget strategy — review your choice periodically as circumstances change.
Business Succession Planning
For business owners, legacy planning extends beyond personal assets. A thoughtful succession plan ensures your life's work continues according to your vision. Effective business succession planning involves:
Open communication with family members and business partners
Setting clear goals for the future of the business
Comprehensive inventory of business assets and liabilities
Realistic timeframes for transition
Funding model and insurance programme
Shareholders agreement that dovetails with the insurance programme
Professional guidance from qualified advisors
Thorough documentation accessible to key stakeholders
Regular reviews and updates
The earlier you begin this process, the more options you'll have and the smoother the eventual transition will be.
Beyond the Paperwork: Your True Legacy
While legal and financial arrangements are essential, legacy planning also offers an opportunity to reflect on the values and memories you want to leave behind. Consider including:
Memorandum of wishes – it provides a non-binding but more detailed instructions or explanations about your wishes for your executors and beneficiaries. Think of this as your personal narrative or story of how you see things.
Letters to loved ones
Ethical wills that share your values and life lessons
Charitable bequests to causes you believe in
Specific wishes for funeral or memorial arrangements. Organ donation and body or organ donation for medical research.
Family heirlooms and their stories
These personal touches transform estate planning into a meaningful expression of your life and values.
Planning for Peace of Mind
Far from being morbid, thoughtful legacy planning is liberating. Knowing you've made arrangements for the inevitable allows you to focus on living fully in the present. You can pursue new adventures, deepen relationships, and enjoy the fruits of your labour with the comfort of knowing you've taken care of the future.
We do not know when the end will come to us, but it does come to all of us eventually, and with proper planning, you can ensure your final act is one of love and care for those who matter most to you. Don't wait for tomorrow to plan for what tomorrow brings—start today, and give yourself and your loved ones the gift of preparedness and peace of mind. Trust me they will thank you for your forward thinking.
This article was written in memory of Stewart Group founder and Nick’s father, Don Stewart, the man with the canny view to start a financial advisory business in little old Hastings over 38 years ago. He will be missed.
[i] https://www.lawsociety.org.nz/for-the-public/common-legal-issues/making-a-will-and-estate-administration/
[ii] https://www.publictrust.co.nz/products-and-services/when-someone-has-died/when-there-is-no-will/
· Nick Stewart (Ngāi Tahu, Ngāti Huirapa, Ngāti Māmoe, Ngāti Waitaha) is a Financial Adviser and CEO at Stewart Group, a Hawke's Bay and Wellington based CEFEX & BCorp certified financial planning and advisory firm. Stewart Group provides personal fiduciary services, Wealth Management, Risk Insurance & KiwiSaver scheme solutions. Article no. 399.
· The information provided, or any opinions expressed in this article, are of a general nature only and should not be construed or relied on as a recommendation to invest in a financial product or class of financial products. You should seek financial advice specific to your circumstances from a Financial Adviser before making any financial decisions. A disclosure statement can be obtained free of charge by calling 0800 878 961 or visit our website, www.stewartgroup.co.nz
