Estate Planning

Dying intestate or without a Will can leave various impediments for your family since there is no guideline for the family to refer to, to handle and dispose of the  assets.

Estate Planning can be understood as the process of planning for proper administration and settling of the property and assets after the original owner of those properties passes away. Therefore, it majorly involves planning for the transfer of a deceased person’s estate and includes cash, clothes, jewellery, cars, houses, land, retirement, savings accounts and immovable property too.

Dying intestate or without a Will can leave various impediments for your family since there is no guideline for the family to refer to, to handle and dispose of the  assets. A whole lot of disputes may surface between the family members and can even devastate the peace and also the process of settling the  estate, in absence of the Will.

Myths of Estate Planning

 People pass away all of a sudden even at a young age, more often without planning their  estate. The reasons/myths for this can be identified as under:

1. A person is too young to make a Will or plan his  estate.
2. A person has to be very wealthy to do  estate planning
3. We need a lawyer to draft all documents and the process is very complicated.

Need for Estate Planning:

In this fast-paced and materialistic world where life is very uncertain and life expectancy cannot be ascertained, the following are among the reasons why there is a need for  estate planning:

(1)  Caring for your loved ones: If the children of the owner are minors,  estate planning generally helps appoint guardians for the minor children. It also ensures that all the assets are transferred properly and managed properly. This will also reduce the possibility of conflict in the family with other extended family members. Therefore,  estate planning in every way secures the future of loved ones.

(2)  Direction for family and Doctors to make healthcare decisions: If there is a properly documented assistance in the form of a Will, and thereafter, if the person suffers a medical setback, this document can act as a guide to guide the family and the doctors to make healthcare decisions. It guides when to use life-sustaining procedures or when to stop using the same to resuscitate the person.

(3)  It protects your family from Creditors to some extent: In case you have impending creditor problems or work in setup, which could be subject to litigation at any point,  estate planning can help to isolate your assets from future creditors. This process involves giving up some control over the assets in favour of your family members while maintaining the right to use the assets when required.

(4)  Prevents further family disputes in future: If there is a properly documented  estate plan for the deceased, it prevents the family members from getting entangled in any bitter court disputes, over the assets of the deceased.

Procedure for Estate planning

The following ways can be used for  estate planning:

(1)  Make a Will: A will as we all understand is the legal instrument that permits a testator, to make decisions on how his estate will be managed and distributed after his death. It gives a proper guideline to dispose of the assets of the deceased after his death, in a properly documented form. 

(2)  Formation of a Trust: - A Trust helps in effective management and distribution of the assets, as there is an appended obligation to the ownership of the property. It mainly arises out of a Trust reposed or lounged for the benefit of another or another and the owner.

(3)  By Nomination: If you appoint a nominee for all your assets, the said nominee can take over and look after all the assets till the time the Succession Court can settle disputes, in the absence of the Will.

Conclusion:

Estate Planning is important since it gives peace of mind to all legal heirs in the event an eventuality occurs with the original owner. It also ensures that the property goes to the bonafide people, whom the deceased intended to transfer the assets. In the absence of estate planning, if one dies intestate or without a Will, assets will be distributed amongst the family members under succession laws of the religion the owner of the property belonged to e.g., Hindu Succession Act, Muslim Shariat Laws, Parsi Succession Act or Indian Succession Act.