“When dealing with retirement advice and SMSFs, we’re generally dealing with older clients, and that can have its challenges, whether it is dealing with death benefits or with incapacity while clients are alive,” Hurst said.

“You also should be considering whether SMSFs are right for particular clients going forward. Even if you do mostly deal with pre-retirees and you have some younger clients, you are going to have to deal with a lot of this stuff at some point, so it’s important to remember that when you’re thinking about estate planning, it’s more than just considering what happens after someone has passed.”

Hurst said statistics show that more than 65 per cent of SMSF members are over 55 and nearly a third of those members are over 70, and although many advisers are dealing with an ageing client base, they are generally in good physical health and living longer than past generations.

“On the flip side, because people are living longer, we’re seeing more cases of dementia, cognitive issues and people losing capacity,” he said.

In the past, Hurst said, estate planning generally focused on whether clients had a will, and where their superannuation nominations may be directed, but he said the sector has moved on from there and must now consider a number of other scenarios that may arise.

He said that as an industry, it’s important that professionals – from accountants to financial advisers and lawyers – work in conjunction in regard to estate planning, starting with pre-retirement.

“It’s strongly recommended that all SMSF members should have an enduring power of attorney because that can make things a lot easier if things go awry in the future,” he said.

“With a holistic approach, it’s also important to consider how all documents within an SMSF line up, whether they are in place, and are actually going to lead to the outcomes the way in which a member is hoping, or if they may contradict each other.”

Hurst said one of the first questions an adviser should consider is if an SMSF is the right vehicle for a client and understand that this can change over time.

“An SMSF may not remain appropriate for everybody, and it really depends on the particular client. People’s investments will change over time and that could be a trigger to consider other things,” he said.

“For example, how would an investment change impact clients that have owned commercial property in their SMSF, but as they’ve retired and sold out of business, maybe their investments have become predominantly shares and managed funds and cash. [You should consider] whether a retail fund may be more appropriate.”

He continued that the death of a member can often be the trigger to consider whether an SMSF is appropriate if a two-member fund is subsequently reduced to a one-member fund.

“Quite often, you might see one member of a couple that’s particularly passionate about investing and running the SMSF, and if something happens to that person, perhaps the other partner may want to simplify things,” he said.

For an SMSF where there are more than two members, Hurst said it is also relevant to consider whether the fund still meets the needs of all its members.

“Lawyers say the ideal number of people in an SMSF might be one because that’s going to cut down on disputes, but we all know that people generally want to be in the same SMSF as their family members,” he said.

“However, it is important to consider the goals of all members and whether being in the same fund is the best solution. In blended families, the question should be asked whether they keep things separate so their estate planning doesn’t get intermingled by different children, which would add some costs. When you’re bringing in new clients, it’s worth considering having those discussions upfront and getting them to consider how some of these things might work.”