If you have waited till retirement to think about writing a Will, then you’re lucky. Lucky, because you didn’t need it sooner. Although the term ‘Will’ gets associated with old age, it needn’t be so. Given the uncertainty of life, there is merit in thinking about what you want your assets to do after you are no more.
Writing a Will is often seen as a daunting and complicated task, but that needn’t be. Here are five details to keep in mind while writing one.
Don’t wait till retirement
If you have worked hard to build assets or have assets bequeathed to you, a Will can help you in efficient succession planning. While you may consider yourself healthy, and not feel the need to have a Will, no one can predict their lifespan.
“Most people think about writing a Will only much later on in life. However, it is never too soon to make a Will. It should be done as early as possible,” said Daksha Baxi, executive director, Khaitan and Co.
One of the reasons is probably the unpleasantness attached to the activity or sometimes sheer lethargy. “People often don’t believe that they need to make a will. For example, a husband thinks if he passes away all his wealth will go to his wife and children, however, legally in the absence of a will, his wealth will also devolve upon his mother,” said Gautami Gavankar, principal adviser, Kotak Mahindra Trusteeship Services.
But what if due to unforeseen events you are incapacitated and unable to write a Will? After all, there is no way of knowing how things pan out in future. Therefore, the earlier you start, the easier it will be to frame a comprehensive Will, if and when assets get added.
“It’s always good to make a list of assets and identify each asset,” said Baxi.
Preparing a detailed list of assets will ensure that you don’t overlook anything. While the big ones like property, financial assets and heirlooms get covered easily, it’s some of the smaller things like family paintings and cars than can get neglected and cause problems later. Some of these things also hold emotional value rather than monetary value for family members and that’s where things can get complicated if left undefined.
“If you are going to divide assets between more than one beneficiary, it’s best to define the split precisely and to reveal in the Will the reason for doing so. This will help avoid any ambiguity,” said Deepali Sen, founder and director, Srujan Financial Advisers LLP.
You must also name all beneficiaries before writing a Will. This accuracy in defining assets and beneficiaries might seem trivial, as you don’t expect your family members to get into a dispute over you assets, but emotions do come into play and that’s when a well-defined Will would help.
Try to describe the asset division in percentage or ratio terms rather than absolute value. This is especially relevant for financial assets such as shares, mutual fund units, unit-linked insurance policies, business or property as these can grow in value. Even writing something like the assets should be split equally among beneficiaries leaves room for ambiguity. Therefore, be as specific as possible.
Keep it simple
It might sound tedious to list assets, beneficiaries, pick an executor for the Will and then put all these details down on paper. However, experts suggest it is best to keep things as simple as possible. “People tend to overthink a will. What is essentially needed is that the basic intention of succession is covered well. Its better to have something written down, even if it’s on a plain paper, rather than not having it at all.” said Gavankar.
You can even make a Will online. Register with the service provider, fill details by answering a set of questions on the website, and submit the form. The Will is automatically generated (see more about this on http://mintne.ws/1HIDnpD ).
Once you have made a Will, inform family members of its existence. Even if they don’t know of its contents, they should know it exists.
Revisit your Will
It’s only logical that if you have made a Will early in life, you will need to revisit it at least a few times. Assets will grow through your lifetime and the list of beneficiaries may change. To account for these changes, it is important to alter the original Will. “One can decide the frequency at which they will look at the Will depending on the changes in assets and family dynamics. But this is critical and shouldn’t be ignored,” said Baxi. Say, there is a change in your address and the Will has a provision to assign the property you live in to a particular person. If the Will remains unchanged, then the property you seek to assign is different from what the Will states.
Moreover, you may have made the Will when your children were young and unmarried, and now there may be daughters- or sons-in-laws and grandchildren to account for. There is no optimal frequency for revision as a thumb rule experts suggest a revision as and when large new assets get added or the family dynamics change.
You can register the latest Will, However, it’s not mandatory. If you do register a Will, any revisions to the original one should also be registered to avoid confusion among beneficiaries.
Nominating beneficiaries for assets where it’s permitted is a good hygiene step as it will mean that the process of asset transfer after death is smoother. “This is especially true for real estate, where a nominee will find it easier to transfer a property to her name. Otherwise (in some states), one has to wait till a probate is done,” said Baxi.
Having a nomination assigned to a beneficiary is not necessary. But keeping the nomination consistent with the provisions of the Will can help remove any confusion. At times, for assets held over a long period, the nominee named could be different from the beneficiary in your Will. This might be due to change in circumstances over the years with marriage, children and so on.
Lastly, remember to assign an executor who you trust will do the needful in a prompt and clear manner.
People often choose family members for this, however, Sen suggests that isn’t always the most productive option as at a time of grieving the family member assigned may not acknowledge the urgency of executing the Will.
Ensure that the people witnessing your Will are present at the time of writing. The purpose is to prove that the Will is authentic. Two witnesses are needed to execute a Will while at least one is needed to prove the Will in court. Try to choose witnesses younger to you due to higher probability of survival.
If the number of beneficiaries or the assets involved are many, you may want to take the services of legal experts so that the document is drafted properly, all relevant details are included and it is legally sound.
Writing a Will does not mean your time is coming to an end. It is only a practical way to ensure a smooth succession whenever your family is faced with the eventuality.
This is an article written by LISA PALLAVI BARBORA on oct 19,2015 Published by Livemint