Estate Planning Issues

Retirement

“Thanks for the financial update. As we get older it gets more difficult to keep up with, let alone, understand what’s going on in the financial world, and we take comfort in the fact that you are able to keep up with the play keep our interests in view. We do appreciate receiving your updates.”

Trevor B

Why we recommend a couple own investments jointly

Sometimes couples like to own their investments in their separate names. Often this is because they have always kept their finances separated or for tax reasons. With the change in PIE tax rules, the tax benefit of the lower tax payer holding all their investments in their name has reduced. Both income and PIE tax is split between joint owners and they pay the tax due at their marginal tax rate.

Probate

In New Zealand, probate is the High Court process that validates a deceased person’s Will and grants the executor legal authority to administer the estate (e.g., collect assets, pay debts, and distribute what’s left according to their Will). If there’s no Will, a similar process called ‘letters of administration’ applies.

In September 2025 the threshold for requiring probate was raised from $15,000 to $40,000. If solely owned assets exceed this or include real estate, probate is usually needed. For the surviving partner, this can delay access to funds/property by 6–8 weeks or longer. Probate costs can range from $300 to $3,000 plus. Jointly owned assets provide immediate continuity. Probate costs an be minimised by having an up-to-date Will.

KiwiSaver, superannuation and life insurance

For life insurance, KiwiSaver, or superannuation, for the beneficiary on the event of your death, name your partner directly – then the pay-out bypasses the estate/probate rules.

Use a Family Trust

Transfer assets (e.g., home, investments) into a discretionary family trust. Trust assets aren’t part of the personal estate, so no probate is needed on death (managed by trustees per the trust deed). This is common in NZ for asset protection and succession planning. We often do not recommend Family Trusts. Set-up costs are $2,000 – $5,000+, ongoing admin costs of $2,000 – $3,000+ annually, and potential tax implications. Most people don’t run Trusts correctly and if disputed most Trusts would be considered ‘sham trusts’.

Lyfords Recommends

For a couple, we recommend the family home, main bank accounts, investments and vehicles are held in joint ownership. On death, they pass automatically to the survivor – no probate is required for transfer. This is the simplest, cheapest way for most couples to avoid probate on key assets.
Note: This differs from “tenants in common,” where shares go via the Will and may need probate.