The financial experts at Motley Fool recently compiled a list of the countries whose residents hand out the largest inheritances every year, and Australia came out in the top spot.
Dan Caplinger, director of investment planning at Motley Fool, stated that Australians regularly leave enormous sums in their wills for their descendents to take control of. The average inheritance in Australia came in at a staggering $500,000.
Mr Caplinger stated that one of the biggest drivers of these high-value inheritance packages is the extreme wealth the country’s mining and resources sectors have generated. Huge companies like BHP Billiton and Rio Tinto have supported thousands of well-paid jobs, while property values have remained strong over the years.
This combination of thousands of high-paying jobs and record-high property values has made the average estate worth much more than those found in Australia’s counterparts. The US, for example, came in at number six with an average estate of $177,000.
With so much money at stake, it’s no wonder contesting wills cases and family provision claims have become much more popular. However, this has also come with its own share of problems.
Contesting wills cases can get complicated
Higher inheritances have raised the stakes in contesting wills claims, and also make it more important than ever for someone to organise their will according to their wishes.
For example, in a recent case in Victoria, the court removed the son of a deceased man as the executor of the estate and barred him from accessing the funds for his legal costs.
Experts working on the case stated it was a good example of how important it is for executors to take great care when administering estates, especially when the relationship between the executor and the deceased involves financial dealings.
In this case, the deceased loaned $300,000 to his son to buy a property that they could both move into, enabling his son to take care of his elderly father in his old age. When the man passed away, the son only paid $50,500 of the loan to the estate, claiming he made up for it in other areas by caring for his father.
The court ruled against his argument, showing how complicated contesting wills cases can be.
With property rates still high and the resources boom chugging forward, Australians can expect inheritance rates to stay high in the coming years.
