This is the first part of a 3-part series on three of the most important instruments in Estate Planning – Wills, Trusts and the LPA
A Will is an expression of your love for your family. It allows you to express your wishes and makes things easier for the people you leave behind. You need a Will if you would like:
- To have your property distributed according to your wishes after your death (These are your Gifts)
- To specify who should receive your assets after your death (These are your Beneficiaries).
- To specify who should will carry out the terms of your Will (This is your Executor).
- To name someone to care for minor children if both parents have passed away (This is the Guardian)
Despite the importance of writing a Will, most people pass away without a Will, like in the case of Mr Tan.
Mr Tan felt he was ‘too poor’ to write a Will
Mr Tan passed away without a Will. He was a widower and lived in his solely owned HDB flat with Mary his only daughter. Mary, aged 30 and single, contributed to the monthly mortgage and expected to inherit the home after Mr Tan’s passing. When Mr Tan passed away, his 3 children including Mary became entitled to a one-third share each of the flat. Mary wanted to keep the flat for herself while her two brothers wanted the flat sold for cash. The children fought amongst themselves. With a Will, Mr Tan could have made his wishes clear and helped avoid such disputes.
When writing your Will, keep these seven things in mind:
1. Maintaining an Inventory of Assets
Your family members face the immense task of gathering what assets you own and where they are located, to assessing their market value. A schedule of assets is required by the court before the orderly distribution of your assets can take place.
2. Choosing Beneficiaries
Your Beneficiaries are the people who will receive your assets. These are normally your immediate family such as your spouse, children and parents. They may also include other relatives, close friends and even charities.
3. Appointing an Executor
Your Executor will take your Will to court for validation and then carry out the wishes specified in your Will. With that kind of responsibility, it’s a good idea to pick someone who is good with numbers, organized and able to deal with the stress of the job.
4. Choosing a Guardian for Your Children
Your surviving spouse is the Guardian of your children by default. But if both you and spouse pass away while your children are still minors, you will want to choose a Guardian that both you and your spouse agree on.
5. Putting Your Will in a Safe Place
Having a Will won’t do any good if no one can find it. Make sure you keep yours in a secure place, such as at home in a safe or with a company that provides custody services. And tell your Executor where you have kept your Will.
6. Finishing Your Estate Plan
Your Will is not the whole estate plan. Your Will comes into effect only when you pass away. Consider a Trust if you want to distribute your assets over a period of time. There is also the Lasting Power of Attorney and the Advanced Medical Directive, both of which cannot be included in your Will.
7. Amending Your Will
You should be amending your Will when you experience big life events in the future such as marriage, divorce, receiving an inheritance or the birth of a child.
Writing a Will is not expensive or complicated. It is a very powerful document because it contains your wishes on what happens to your property and family after your death.