Many of us tend to get emotional when asked if we had written a Will, reminiscent as it is of death. Consequently, estate planning, particularly creating a will, is often disregarded as an essential task. Moreover, the process of writing a will is commonly perceived as complicated and irrelevant. However, it is important to recognize that making a will is a responsibility you owe to both yourself and your family.
Here is a comprehensive guide that can assist you in creating a foolproof will:
1) Understand the importance of a will
Before embarking on writing a will, it is crucial to comprehend its fundamental purpose. Regardless of your financial status, having a will is something all asset holders should have. It is not exclusively for the wealthy; rather, it is a legally enforceable document that ensures the distribution of assets and property according to your wishes. Drafting an accurate will is advisable to safeguard your estate from probate courts and other legal issues.
2) Take inventory and decide on beneficiaries
The next step involves taking stock of all your assets, properties, shared holdings, bank balances, savings, investment accounts, policies, and any other relevant items. It is also important to include liabilities in this inventory. Gather all necessary documents, certifications, registrations, licenses, etc., related to your assets. Once you have these details, you can estimate the value of your inheritance. This estimation will help you determine how you want your assets to be distributed among your surviving spouse, children, extended family, friends, and other relatives. Keep in mind that if you have shared accounts and assets with existing beneficiaries, such as a Pension Fund, a company EPF account, or a life insurance policy, those beneficiaries will take precedence over the will according to the law. Therefore, ensure that all beneficiaries, including the will and other assets, are updated according to your current wishes.
3) Draft the will and choose an executor
Once you have decided on the allocation of assets, the next step is to legalize it by drafting a will. The will should include all your assets, the specified distribution shares, the beneficiaries for each share, designated guardians, trustees, etc. It is crucial to draft the will while you are in good health and of sound mind. Be specific and realistic about who will inherit what, ensuring there is no ambiguity. Negligence in this regard could lead to potential legal disputes. It is advisable to seek the assistance of a professional estate planner to ensure the accuracy of your will. After drafting the document, you will need to select an executor for the will. The executor is responsible for reading your will and ensuring that it is executed as stated. They will oversee the distribution of assets, payment of debts, and taxes. Ideally, the executor should be a responsible and trustworthy person with a sound mind. You can choose your bank, a family member, a friend, or your attorney to be the executor. The essential aspect is to ensure that this person is ethical and will not be swayed by future stipulations. Additionally, it is crucial to invoke your Power of Attorney in the event of incapacitation or death. In such cases, you may need to assign the executor as the administrator of your estate.
4) Choose a Guardian for Your Children
This is relevant for people who have minor children or kids that need more attentive care due to a mental or physical disability or an underlying health issue. In such cases, it is important to name a guardian in the will. This guardian can be a close dependable person who would be willing to take on the responsibility in your absence. Moreover, it is advisable to discuss the matter with the concerned person before naming them. You can also choose to set aside some funds for the guardian. This can be considered as reimbursement of expenses incurred while taking care of a child. In your absence, the guardian gains access and authority to all your assets as specified in the will.
5) Sign Your Will
One of the most crucial steps in creating an airtight will is signing and dating the document. However, this must be done in the presence of at least two witnesses who can validate the process. The witnesses are required to sign as proof of their presence. According to the law, only a written will with valid signatures from witnesses is considered authentic. It is important to note that witnesses cannot be stakeholders named in the will, and they must be at least 18 years old to qualify. Any discrepancies in this aspect could lead to potential challenges in court. To ensure the validity of your will, it is essential for the witnesses to confirm that you signed the document without any external pressure and in a sound state of mind. Additionally, obtaining a medical certificate from your doctor to verify your mental capacity can help prevent future challenges. Since each state has its own legal requirements regarding the signing of wills and witnesses, it is advisable to conduct a pre-check to ensure compliance.
6) Secure Your Will
Once all the necessary steps have been completed, it is crucial to keep your signed and witnessed will in a safe and secure location. This place should be protected from potential risks such as fire, theft, or other hazards. Furthermore, it is important to inform your attorney, bank, or reliable family members and friends about the existence of your will and its storage location. It is also recommended to store all other relevant financial documents in the same secure place. This can include items such as bank account passwords, tax returns, insurance policies, funeral instructions, and any other information you wish to pass on to your loved ones.
7) Regularly Update Your Will
The final and crucial step is to consistently review and update your will. Creating a will is not a one-time task that can be set aside indefinitely. As time progresses, there may be changes in your liabilities, assets, properties, and other important aspects. It is necessary to periodically assess the distribution dynamics outlined in your will. Additionally, you may need to reconsider the appointed executors, beneficiaries, and administrators of the estate to accommodate new relationships and changes as you age. Life events such as marriage, the birth of children, divorce, the unfortunate occurrence of physical or mental disability, or the onset of critical illness must also be taken into account and reflected in your will. Failing to update your will to incorporate major life events can lead to confusion and disputes among your beneficiaries in the future.
In Summary
Although many individuals neglect the inclusion of a will in their financial planning, it is a critical aspect for safeguarding the future of your loved ones. By following this straightforward guide, you can provide the much-needed assurance to your family and secure their well-being. Remember, regularly reviewing and updating your will ensures that it remains relevant and effective in protecting your assets and fulfilling your wishes.