Episode 12

Estate Planning Essentials: Creating a Lasting Legacy Beyond the Will

How do you prepare the next generation to inherit wealth responsibly? In this insightful episode, David Murdoch shares practical strategies for educating children about financial responsibility and creating appropriate structures for wealth transfer. From teaching kids the value of money in a digital world to establishing protective legal frameworks, David explores the delicate balance between generosity and responsibility. Learn why early financial education matters, how to structure inheritance to protect assets, and why open conversations about money can strengthen family relationships across generations. Whether you're planning your estate or helping your children develop healthy money habits, this episode provides valuable guidance for ensuring your wealth creates a positive legacy.

You can get in contact with David Murdoch on LinkedIn https://www.linkedin.com/in/davidsmurdoch/

Or you can reach out to Paxton Bridge

https://www.linkedin.com/company/paxton-bridge/

https://paxtonbridge.com/

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This podcast has been produced by: https://podcastsdoneforyou.online

Transcript
Anthony Perl:

Estate Planning Essentials, creating a lasting legacy beyond the

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will Welcome to Activate Your Wealth.

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In this episode, David Murdoch, the

principal advisor at Paxton Bridge

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and the pioneer of wealth activism,

talks about the critical importance

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of comprehensive estate planning.

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You'll learn why basic wills often fall

short for complex family situations, how

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to protect assets through testamentary

trusts, and why addressing a state.

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Planning early, prevents

costly complications later.

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I'm your co-host Anthony Pearl, and

whether you're a successful business

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owner, executive, or family seeking

to align your wealth with your values,

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it's time to activate your wealth.

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David, this is a think an uncomfortable

topic for people to talk about in many

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respects, which is estate planning

and legacy creation, because I think

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we all in a sense know that we should

do something about having a plan.

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Yep.

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But nobody ever wants to think

about their own mortality.

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And it's one of those things that often

get put off and people think, oh, I

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haven't, they won't have any money.

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Yeah, exactly.

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And, and, but yet this whole idea of,

of estate planning and um, is, you know,

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it's a critical one for people to be

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David Murdoch: absolutely.

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Like we, we, we.

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It's really one of those key questions

that we ask initially had, you know, do

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you have a will or a power of attorney?

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It's amazing how a lot of people just have

a will I go, oh yeah, I've got a will.

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Okay, but what about a power of attorney?

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I haven't got that.

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Which I'm always a, been intrigued about

that if they've been to a solicitor

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that the solicitor wouldn't have, you

know, suggested that they do that.

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Um.

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Yeah.

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There's always that pushback that,

no, I don't wanna talk about it.

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You, I'm, you're gonna mos me.

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I'm, you know, I'm, my

mortality is not there.

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I don't wanna talk about it.

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Like, okay, that, that's

a, a bit of a flag.

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I go, why?

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Because you need to disclose

all this information to, to get

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a solicitor to deal with it.

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But it's also the choice.

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It's like, no problem.

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You can do, you can die without a will.

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Do you want the government formula

in each state to determine how those

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assets will then be distributed?

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No.

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Okay.

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So why would you not want to do that?

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So, so that's what basically by not having

it, you do have one, but because it's a

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government formula, but do you want the

government to make the decisions about

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how your assets will get passed through

and will those assets pass to people that

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you, you don't want to be distributing to?

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But that's, no, it's not.

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That is the way it will work.

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And so the investment required to

get it set up might be, and I'll use

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a round number, five grand, right to

get, if you're reasonably complex, it

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could be more, but if you were to not

have it and then something occurred, it

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could cost you 50 or or 500 grand going

through the courts to get your estate

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sorted out post death, because you

haven't given any clear instructions.

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So why would you not want to do this?

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It's a regular conversation as

as uncomfortable as it can be.

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The other thing that we try and encourage

people is to have, once a child turns 18,

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to put an estate plan in place for them.

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And again, the pushback can be

Yeah, but they don't, they don't

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own anything I said I know, but if

a child's 18, they're, they're an

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adult under the, uh, cause of the law.

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So at what point after

they're 18, should they get.

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A will and the powers of attorney,

and again, I, I, I think a will

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is probably not the real priority.

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It's the powers of attorney for, I mean,

18 to 25-year-old males are lunatics that

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their decision making can be quite risky.

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And I think the girls are probably

just as bad these days, but you

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know, at what stage do you do

that until they're is stable.

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But it's also part, this goes back

to this issue of when we talk about

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wealth activism, it's about education.

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The responsibilities of being an adult and

one of those is to understand, well, where

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are your affairs and what are you doing?

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Like generally, if they're

working, they'll have a super fund.

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If they're doing that, they

would've made contributions.

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At what point if a grandparent potentially

may have gifted some money to that

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child and all of a sudden they don't

have a will and something happens to

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them, or if they're overseas and they

want you to access their bank account.

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For whatever.

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Like, I, I just, it's, it's just bringing

it in to be a normal conversation for

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people and not to look back on it and

think, oh, I don't want to deal with that.

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We, it's just, let's be really clear

around what you would like to see happen.

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You know, and again, part of that

strategy comes into your estate

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planning, especially if you've got

proceeds sitting inside a super fund.

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I mean sometimes you can plan

it and other times you can't.

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But if you know that someone is

diminishing and they're close to the

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decline of their debt and they've got

money in super and this is without

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any, this is a general advice,

you would, you would pull it out.

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I wouldn't put that, you

know, you wanna understand the

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personal, personal circumstances.

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So if there was a couple and there

was one surviving spouse, the

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other one was already deceased, you

wanna get the money outta super.

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'cause if you leave it in there,

you gotta pay the death benefit tax.

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Because if there's no financial

dependence, you gotta pay the tax.

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So why would you not distribute it?

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Again, this gives the whole issue

around dollar zero or you know,

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how, how do you deal with it?

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Let's distribute the funds

out prior to them occurring.

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'cause you can't keep

it in the super fund.

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Doesn't matter whether it's

retail or self-managed.

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You can't keep it in the super

fund after death if it's not,

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you're not a financial dependent.

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So little stuff like that, and

again, it's having this conversation.

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Wow, what would we like to have

happen with some of these assets?

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Anthony Perl: And it is an uncomfortable

conversation because you're talking about

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it, I suppose, from two perspectives.

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One is that, you know, you might be in

your forties, fifties, um, and you are

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okay, we should really have a plan.

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Yeah.

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And then there's also the, you know,

the parents, the, the grandparents

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that, you know, do you have a plan?

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Yeah.

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And what does that look like?

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And should we have a conversation

about changing that plan?

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I

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David Murdoch: had a few hours and a few

favorite, like, which to, to be honest,

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what, what I've done with a few people

is given them a deck of our, um, values

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cards and said to them, look, just go and

have this conversation with your parents.

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'cause sometimes the pushback becomes,

well, what are you just waiting for

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me to die so you can get our money?

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It's like, no, that is not the,

what we're trying to address, what

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we're trying to address through

this conversation is to understand

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what would you like to have happen.

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Once you are deceased,

not we are after it.

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What?

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We wanna make sure that the

distribution of your assets is as

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per what you will wish to occur.

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And we need to think through

this and we need to have this

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conversation in a calm, non-emotional

position, not at a heightened.

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We don't wanna be in the situation

that mom or dad's in the hospital

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and they're about to flick the

machine off and we are getting them

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to sign their final will because

they hadn't really thought about it.

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This is just a very systematic, there's

an element of being clinical about it,

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but it's being really clear rather than

it in that heightened level of emotion,

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which unfortunately does occur, but

it is it, it's thinking through and

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going, oh, actually I'd like to do that.

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Or to be honest, I don't want to have,

I mean, there's a lot of people that

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don't have any assets in their own name.

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They're held in trust or super funds.

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So the will only deals

with your personal assets.

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So you've gotta deal with the other

assets that are sitting in trust

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or, or, or company structures.

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Again, that's another interesting one.

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When you talk about powers of

attorney, sole director inside a,

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inside a, an organization, who's

the corporate power of attorney?

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The what?

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I said, well, your personal

power of attorney doesn't

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deal with you as a director.

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Oh, come a wife decide.

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No.

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I hadn't thought of that.

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Multiple directorships.

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What do I do?

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Who signs on my behalf?

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Well, the bank, do you know what I mean?

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It's always a query a lot of people have.

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They go, oh, but I don't,

do I really need that?

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I, I think you need to assess it.

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You can make the decision not

to, but I still think it's

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important to have this in place.

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Like it's not, people make a decision on

whether they wanna accept them or not.

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But sometimes, again, you do the lap

a few times and you get round to the

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third time they go, yeah, I probably

need to get some of this sorted.

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Because there's also inconsistency

within the entity documentation.

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That's a really interesting one too,

because if a, a good estate planning law

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will review all of those entity documents

and sometimes there is inconsistency

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what they would choose to have happen.

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The entity documentation

doesn't allow them to do that.

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So therefore you need to make a variation.

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It's also part of a, just a

general review and health check

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for, for your own estate planning.

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So it's, yeah, I, I just see it as

a really vital and important, um,

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you know, discussion.

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Anthony Perl: And I think, you know,

there are so many examples of where.

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This can get complicated

for families, right?

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Isn't it?

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I mean, it's just like, it's

a, it's such a can of worm.

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I mean, just think a simple scenario that,

that someone, um, you, you've got two

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kids and they've got their own children

or one of them, you know, gets divorced.

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Marries a mar, someone else, they might

have more kids together or they might

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have another, they might have bringing,

you know, kids from another relationship

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in, you want to give money to.

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Grandchildren will leave

money to the grandchildren.

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Yep.

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You know, do you do it evenly?

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Do you, you know, do you, do you

include, you know, kids that are not

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really your family line because they,

you know, they've been married in Yeah.

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There's so many questions, right?

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Yeah.

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It's not, and, and that's

not an uncommon scenario.

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No, it's not that.

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And then they might not be married,

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David Murdoch: but they

still have a child together.

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But they're in a de facto.

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Anthony Perl: Yep.

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David Murdoch: But, but both of them have

got children from a previous marriage.

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Then you go back up and even sometimes

the, the, the parents, it might

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be their second relationship, but

they've got, do you know what I mean?

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Absolutely.

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Very, very complicated.

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And how do you cascade?

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And so partly mapping out that

family tree structure is determined,

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well, what would you like to occur?

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But, and you've also gotta look at it

on the basis, have we addressed this?

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And then, um, in the communication

that you put forward that you

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made, put some notations around.

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We, we've considered the fact that,

you know, Anthony's part of the family

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tree and, and therefore, but however

he's been estranged from the family.

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Therefore, there will be a, a, a form of

a potential, um, gift provided to him,

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but it's limited compared to the others.

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So we've taken into account, but you've

been estranged like all of these issues

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that sometimes you, it's hard to be, it's

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Anthony Perl: absolutely, it's hard.

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To be fair, it's hard to be fair.

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But I mean, even, even a simple

scenario that's, that, that I think

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is, I would imagine is very common.

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A couple has two kids.

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Yep.

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Those kids, um, each have

children of their own.

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One has two children,

one has three children.

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Yep.

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How do you distribute the wealth?

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Is it based on, well, we divide it up

by five and therefore it, you know,

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it, it goes if you're going to the

grandchildren, do you literally do it that

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way or you go, well, you know, because

they've decided to have more children.

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Should they just, you know, should

do we break it in half and then

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one side gets split by three and

one side gets split by by two.

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How do you actually play all of that

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David Murdoch: out?

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But see, this is again, comes back

to the query about wealth activism.

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In that estate planning process.

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At what point have you gifted or, or, or

provided support to children potentially

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along the way, and is there an element

of estate equalization where one side

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you may have, you know, provided support

for, let's call it a hundred thousand,

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and the other you haven't done anything

to, you may deal with that at the time of

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debt, that there's a cash proceeds that

come to that and then the balance gets.

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Equalized or you may bypass the children

and go straight to the grandchildren.

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So again, part of these conversations

around what are, what are we dealing

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with when we start to talk about,

yes, the estate planning is the,

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um, fall process in the, in the,

in the way that it's documented.

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But there's also these conversations

that you have through over the years.

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This is what we're choosing to do and

I'm choosing, and part of my distribution

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strategy is over the last three to five

years of my life, and it might be in.

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Holidays or, or being quite clear

about this is what's happening.

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So when I do, um, uh, are deceased,

there's actually not a lot left because

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I've already made that conscious decision.

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'cause I've given it

while I've been around.

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So, so again, it's a much broader

conversation to have with people

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and to understand, even if you've

cascaded some assets to a child,

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then there's an obligation that

says, well, if I need support as a

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parent, you guys need to continue.

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So it might be that they've.

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Provided some money to them that

sits in their offset account as an

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expectation that you cover my living

costs until I'm deceased Again, you

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can have those conversations with

people, but, but you've gotta make

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sure that it gets done appropriately

and that it's documented, because then

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you don't want assets cascading into

a child, and then once they've got

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the money, they, you then get divorced

and that asset gets split that way.

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So there's, yeah, it's not a,

it's not a simple conversation,

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but, but it's a, it's a very

important conversation to be having.

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Just to again, address it like it's not,

I think sometimes shoving your head in

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the sand and not wanting to address it

'cause it's a too difficult conversation

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to have is actually detrimental.

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Anthony Perl: I think the, the interesting

part about all of this is you are

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going to a lawyer to create this.

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In reality, the lawyer is just

providing the mechanics correct.

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And that the congregations need to

be happening, happening separately.

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When you talk about, about, you know, um,

wealth and the transfer of wealth and,

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and legacy, that's where you come in.

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Correct.

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David Murdoch: And that's

where it's really important.

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So for us, we, we've had a lot of

these conversations with, with a

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couple, um, or even a broader family

group, so everyone's very aware of

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what's going on, and we've had these.

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We've got this view on it, like this

is what I would like to see happen.

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Therefore, now let's bring in

the estate planning lawyer to

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document what it is to get done.

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Now they may say, well, that

can't be possible, or That's

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possible and we can do it this way.

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Great, so let's document

and formalize that process.

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What I find really frustrating within

the profession is that some people

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say to a client, just go and see the

solicitor and get the solicitor drafted.

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That's of no value to the solicitor

because they don't understand that

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there's not, there's no context

always around what it is, and we

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would've heard a lot of conversations.

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But part of the, the engagement is to

get that documented, to communicate

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with the solicitor, but to be in the

conversation with the solicitor and

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the client to, to, to interpret what

some of the legal jargon might be, or

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for myself and the solicitor to have a

discussion that says, oh, this and this.

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Then to, to, to put it in

layman's terms for the client.

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Now, some clients are all over it.

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Like they, they're, they're sophisticated.

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They know what they're talking about.

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Others are going, I have

no idea what you just said.

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To me, it's like a foreign language.

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Therefore, you've gotta bring it into

a point where you go, this is why we,

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and that's why visuals are really good.

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We always have visuals of entity

structures because then we can draw lines

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and show them, well, what we're doing is

that this happens and this happens, and

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therefore this will pass out to this.

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It makes life much easier.

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And the same for the,

um, estate planning hire.

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They love it because all of a sudden

you've documented a lot of things that

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they would have to get their hands on.

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But as part of our engagement,

we, we just provide them with the

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soft copies and they go, awesome.

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They, they can fast track and to

do, have a much more meaningful

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discussion rather than spending time

capturing a lot of basic information.

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Anthony Perl: Now, let me put

you on the spot a little bit.

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What are some of the common mistakes

that people, that you've seen

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people make when it comes to the

whole idea of estate planning and

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even the, uh, the legacy creation?

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David Murdoch: Some of the mistakes is

probably not really considering, they

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might be reasonably sophisticated,

but their will is a basic will.

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So basically assets just passed to each

partner and then down to the children,

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and there's no asset protection in that.

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You know, that, that,

that's probably one of the.

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Because it's like, oh, I didn't

wanna have to spend that much.

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You know, it's a two page will,

and these individuals could be

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worth 10 or $20 million or more.

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It's like, hmm.

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I perhaps wouldn't have done that.

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I would've, again, it goes back to

the argument around a testimony.

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Trust means that this, the trust deed

as such is he's written within the will

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and he only established upon death.

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Right?

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So you then have a choice to

establish it or not establish it.

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Whereas if it's a basic will where

the assets just passed to each

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partner and then down to the children.

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You can't retrospectively add

back in a ary trust, so you,

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you lose a bit of flexibility.

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That's probably the biggest one.

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The other one is also the powers of

attorneys that sometimes they don't

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have them, or they're quite old and

they're like, yeah, I don't, yeah, that

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person would've been good, you know,

10 years ago, but now I think about it.

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Either don't see them a lot or he or

she's had some complications in their

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life that I wouldn't want them to be.

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So, so it's just important to

review it on a regular basis.

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And again, everyone's circumstances

change, and it may not be your

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circumstances, it may be the

individual that's been nominated

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within the estate planning documents,

their circumstances have changed.

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And that could be, they might be,

they may have been, um, deceased

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or, or incapacitated in some way.

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So how can you get them to do stuff

for you then they're, they're not even.

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One, if they're not alive, it's like,

well, you, you need to replace that.

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And so again, they, they, they're

probably the two biggest issues

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that we have or people delaying.

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Yeah, I'll get to it.

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Yeah.

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Yeah.

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I'll get to it.

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Right.

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No, no.

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This is, we, we try and encourage

people to get it, to get it done.

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It's bit like it sits in your back pocket,

you know that it's done, and you've got

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the control as to where stuff is going.

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You can always change

it, and some people do.

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They might change it every two years.

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And they know that there's a cost

involved in that, but you know,

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the circumstances have changed.

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They wanna change stuff.

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Okay, great.

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I think it's a good thing that people

keep reviewing it, looking at it,

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but they're probably the biggest,

they're probably the biggest ones that

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they haven't looked at it and all.

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They're quite old.

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Anthony Perl: Yeah.

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But I think the important lesson here

at the end of the day is to make sure

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you've got all of these things, isn't it?

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I mean, that's, yes, correct.

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That's the key to all of

this is uncomfortable.

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And we started this by saying it is

an uncomfortable conversation in many

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respects, it's not, and it doesn't come

easily, but it is about understanding.

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If I, you know, encapsulate what

you've been saying, understanding

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different FA family dynamics and

understanding the things that are really

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a must have, like you've just said.

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David Murdoch: But it's a bit like

people, people will pay for their house

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and contents insurance every year.

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They'll pay for their

car insurance every year.

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Do you know what I mean?

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You've got those two things that, that

people pay for, but they say, oh, I don't

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wanna spend five grand on my estate plan.

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I'm like, wow, really?

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This is giving the guidance and

direction of everything that you want,

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but you're happy to pay for that, you

know, um, general house and content

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insurance every year, and that might

be three grand or five grand or.

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Depending on where you live,

could be even tens of thousands

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of I but able will replace stuff.

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I'm like, yeah, I know, but this,

yes, there is an investment,

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but that may not be every year.

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It might be once off, and then

it might take you five years

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till you need to change it.

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But you review it every so often

to make sure it's still valid.

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And again, if you've reviewed Dick, great.

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I'm happy with what we've got.

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Also, they need to change.

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Remember that one?

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Where is the original document?

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Uh, uh, I think it's in the safe at home.

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No, no, no, no.

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We need, there's not a thing we need to

know, or I think it's at the solicitors.

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I mean, we utilize now predominantly

the, the Victorian will bank.

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So we would put the, the original

wills and powers of attorney

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documents within the will bank and

that way that becomes the first port

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of call, if you would look at it.

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We would've soft copies available

for everyone but originals what will

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go to, you know, um, state trustees

and within the will back and that

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it's, you can call it back and.

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They've got fireproof safe and all

of those things, but it's a central

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area for, for the documentation to be.

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Anthony Perl: I was gonna say that

that's probably a good way to wrap things

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up by reminding people that it's one

thing to go and do it, but if you don't

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tell anybody that you've done it well

where it is, it's a bit of a problem.

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Right.

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David Murdoch: Yeah.

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Well that's it.

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That's why we keep a record of

who's got the original, who's got

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the soft copy, and sometimes there

might be three or four people that

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have got a soft copy, so at least.

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And they might be the executors or,

or the powers of attorney, just so

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they know that they've got a copy.

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And sometimes they'll have a certified

copy, so they, if they need to go to

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the bank or to do something, they've

got the ability or medical one.

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Medical ones are always a really

interesting one, you know, because

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people go, I would write, especially

with parents, you wanna make sure that

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you've got one for them, especially.

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But again, with kids, I, I, I just

think it's, uh, as they refer to

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it as the learning of adulting.

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Is getting a estate plan in place

for them, but also, yeah, as you

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say, knowing where it is, who's

got it, and how do we call it back.

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Anthony Perl: Thanks for tuning in

to the Activate Your Wealth Podcast.

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For more information about how to

get in contact with David Murdoch

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and the team at Paxton Bridge.

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To learn more about wealth activism,

take a look at the show notes.

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There's plenty of information there,

including details of the website and

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all the social media channels to follow.

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David, this podcast has been

produced by podcast Done for you.

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I'm Anthony Pearl reminding you to

subscribe so you never miss an episode.

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About the Podcast

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Activate Your Wealth
with David Murdoch, the Wealth Activist®

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About your host

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David Murdoch

I am passionate about helping my clients activate their wealth. Success can’t be left to chance. At Paxton Bridge, we’ve developed Wealth Activism, a philosophy that establishes a firm foundation upon which we build personalised wealth activation plans for our clients. This foundation is under-pinned by three core pillars - money mindset, asset management and intergenerational wealth - which are critical in helping us bring people together as they transition to ‘more life, less work’.