You’ve probably seen many headlines that highlight yet another inheritance dispute or a court case where family members contest the validity of a will. These legal tussles can get quite unsavoury; not to mention time consuming and resulting in legal fees which may gradually deplete the estate.
When a person passes away leaving behind a valid will, the person is said to have died TESTATE. There are many advantages of writing a will: You can decide who can inherit your estate; how much each beneficiary should get; and when each beneficiary will inherit your estate.
However, you need to pay attention to special situations such as:
- If the beneficiary is a bankrupt or facing bankruptcy, try to name another person to hold the inheritance in trust for this beneficiary. Otherwise, the inheritance will go to the beneficiary’s creditors.
- If you hope to provide for the children of your previous marriage through the will, you can expect your current spouse to give priority to her/his own children. You need to speak with a professional consultant who may be better able to advise you.
- If your elderly parents cannot communicate well, you might want to appoint two executors to ensure they receive their share of your inheritance.
- If you want to provide for your beloved pet, be aware that a pet is not a legal entity. Therefore your pet cannot receive your inheritance on its own. You need to leave the money to a person or organisation for them to use the money to take care of your pet.
- You can leave instructions to the executor to preserve your estate and time the distribution to the beneficiary.
If a person dies without a will, the person is considered as having died INTESTATE. Here’s a lesser known fact: A person can also be considered as having died intestate if he/she leaves behind an invalid will, or in the instance where his/her will cannot be located. Passing on without a valid may create uncertainties regarding the distribution of your estate and the beneficiaries.
Problems surrounding beneficiaries determined by the intestacy law:
- Elderly parents may be excluded from your estate if you are survived by your spouse and children.
- Stepchildren are not included in the list.
- Illegitimate children are not included in the list.
- Children from your previous marriage might be disadvantaged.
- Ex-spouse can gain access to your estate as a guardian of your children.
- Couple going through separation leading to divorce is still considered husband and wife, and hence the surviving spouse is legally entitled to at least 50% of the estate.
- The next of kin could be the administrator or co-administrator of the estate, but might not be entitled to the estate.
- Living-in partner is excluded from the list.
- If one beneficiary is bankrupt, your estate could land up with the beneficiary’s creditor.
- If one beneficiary lacks financial discipline or maturity, you can’t withhold the distribution to him. The administration cannot hold the assets in trust, and must distribute the estate to the beneficiaries after the probate formalities are completed.
- Your best friend is excluded from the list.
- You cannot leave a legacy to any organisation.
It would be wise to not leave everything to chance. Sit down with a professional consultant who can help you map a clear plan for the future!Share on Facebook Share on LinkedIn Share