Half of Kiwis don't have a will. In the under-40 age bracket the figure jumps to 70 per cent.
Some of those will-less people have fewer than $15,000 in assets and have no children. Thanks to KiwiSaver, that $15,000 threshold is easy to reach.
An awful lot of people who have never saved in their life have built up that much or more in their retirement savings. When they die, that money becomes part of their estate.
An awful lot of people who have children or assets or both don't have but should have a will. If they die without one, the intestacy rules will determine who their assets are paid out to. These rules are very rigid.
The trouble for many of us is that we don't want to think about dying and put off writing a will.
"You don't wake up in the morning and think: 'I am going to write my will today'," says Andrew Barnes, managing director of fiduciary company Perpetual Guardian. "Writing a will is something people keep putting off."
Typically there needs to be an event such as a death or a birth in the family that makes you want to go out and get a will, says Barnes. You shouldn't wait for that.
Part of the problem of our will-less society is that people think it's complex, they need to make an appointment with a solicitor and that it will cost a lot of money.
Online will writing is the answer to the problem for a swathe of Kiwis, says Barnes, whose company offers two online packages. The price for an online Perpetual Guardian will starts at $49.95 compared with an average of $195 for a face-to-face meeting.
"The under-40 generation [is] increasingly used to doing absolutely everything online," says Barnes. "If you can make the process accessible then you have more chance of getting people to do it. That's where the online process comes in."
Perpetual Guardian has recently launched into the online will writing market with two brands: My-Bucketlist.co.nz and ewills.co.nz. My-Bucketlist is aimed at young people and takes five minutes to write a will. It needs to be printed and witnessed. The other site, ewills, was launched before Perpetual Guardian bought My-Bucketlist.
It's not the only company in New Zealand offering online wills. For $75 the Public Trust has a "Simple Will" service, which involves an online questionnaire. The will is sent to the local Public Trust Office and you need to make an appointment for it to be signed and witnessed. The service can be found at tinyurl.com/simplewill
The slight catch with Simple Will is that it requires the Public Trust to be appointed as executor, which means there are charges for administering your estate. That includes an establishment fee of $1450 and $775 for applying for probate followed by $220 to $285 an hour. For small estates executor fees can eat up an awful lot of the money. If you'd prefer to appoint a family member as executor this isn't a possibility.
Kiwibank also has a free legal will service online at tinyurl.com/Kiwibankwill. As far as I could see anyone can use this system, not just customers.
The reality is that digital solutions are the way the wind is blowing, says Barnes. "[Online wills] will become more mainstream as we go forward." The arguments against them, says Barnes, are more valid than "sitting there and saying 'I am not going to do my banking online'. Remember that?" Many under-40s who don't have a will have relatively simple affairs, he says, and don't need to sit down face-to-face with a lawyer.
"If you have very basic affairs an online system will be adequate and better than the alternative, which is not getting a will."
Barnes argues that online wills have fewer dangers than printed ones that people used to buy at Whitcoulls. The algorithms used online are becoming more sophisticated and are designed to stop you in your tracks if your personal situation falls outside standard parameters.
What's more, says Barnes, even if you complete your will online, it is reviewed by his staff who will call a customer if anything looks out of place.
Beware, however. Free or low-cost online wills may not save money. The document could be invalid if it's not witnessed correctly.
Whenever I've written about DIY wills, industry professionals collectively suck air through their teeth and say, "It's dangerous".
The implications of a poorly thought through will are sometimes serious. The case of police officer Don Wilkinson always comes to mind, when I think of the mistakes people make with their wills. Wilkinson wrote his will in 1985 at age 23 when he owned just two guitars and a second-hand car. By the time he was shot dead 23 years later in 2008, he was worth more than $2 million, but it all went to his stepfather.
He was reported to be very close to his mother, who lives in humble circumstances on a pension. Would he have wanted some of the money to go to her? Probably. But he never updated his will.
It's not uncommon for beneficiaries to fight over a will. Legal costs to sort the mess out could eat into whatever money you leave. Just search the word "probate" or "estate" on the Ministry of Justice's Judicial Decisions Online database at forms.justice.govt.nz/jdo/Search.jsp and read some of the cases.
The first case summary I opened up was of siblings James, Nicola and Angela who were fighting over their parents' estate. James had spent $18,142.05 on legal fees, the judgment noted, and no doubt his sisters had spent a lot as well. This was a case of complex wills rather than poorly drafted ones.
Although I have a will, I signed up to try out all the online will services I mention and played around with the tick-box options. I was stopped more than once and warned that the boxes I had chosen threw up a red flag.
The ewill system said, for example, "You have indicated that none of the above options are suited to your family situation. We strongly recommend that you speak with one of our advisers when they make contact to discuss how your wishes can be correctly represented in your will. This being a non-standard will, the price to complete your will is $150."
The red flags are numerous and varied depending on the package. Some of those flags included:
• business ownership
• family trusts
• agreements contracting out of the Property (Relationships) Act
• excluding my spouse/partner or any children from the will
• family estrangements
• beneficiaries who suffer from addictions or have disabilities and
• interests in Maori land.
Whenever I was kicked out of the system I was given explanations of the problem and asked to contact the office directly.
For example, My-Bucketlist told me, when I ticked the option not to leave money equally, "Where a person ... does have children, they tend to leave their residue to their children equally. If you want to do something different with your residue, we strongly recommend that you speak to a solicitor."
Wills aren't a set-and-forget thing. They do need updating when you have major changes in life, such as getting married, separating, having children or grandchildren and buying a property. After a 14-day period in which you can change your online will for free, customers must pay the $49.95 again, says Barnes.
Since launching ewills and buying My-Bucketlist, Perpetual has seen a 50/50 split between traditional wills being written through the company and online wills.