What are Mutual Wills?
A Mutual Will is more than two people making ‘mirror Wills’. Mutual Wills are created, in effect by a second document, a binding agreement which contains directions about the Willmakers current Wills.
What is the effect of having a mutual Will?
Having Mutual Wills imposes controls over the Willmakers, essentially having the effect of ‘setting in stone’ the content of their Wills. In many cases, the Willmakers will not be able to revoke or change their Will without the consent of the other Willmaker (or after the death of the first of them, the executors of their Will).
When are Mutual Wills helpful?
Mutual Wills offer greater certainty that the wishes of the spouse who dies first will be met on the death of his or her surviving spouse. The main advantage of Mutual Wills is that they protect the interests of your intended beneficiaries and ensure your estate is distributed fairly and as you intended.
Proceeding with caution
Mutual Wills tend to offer little flexibility to Willmakers. Mutual Wills can create a restraint on both your discretion and your spouse’s discretion to make decisions in the future.
If you (or your spouse) wish to change your Will, your spouse will need to agree to the changes. While Mutual Wills can be useful in alleviating uncertainty for Willmakers, they can be problematic if they are not used appropriately and drafted carefully – potentially increasing the risk of challenge to an estate.
Are there any other options available?
There are a number of other options available to you including:
- Using Trusts;
- Providing a ‘life interest’;
- Providing a ‘right to reside’;
- Gifting or transferring assets during your lifetime; and
- Using Life Insurance and Superannuation to provide benefit to beneficiaries.
If you would like to know more about Mutual Wills or the other options mentioned in this factsheet, contact CRH Law’s team of dedicated professionals who will be happy to assist you. CRH Law offers specialist estate planning advice individually tailored to meet each of our client’s needs.