Individuals and families are putting a lot of effort to save and invest. But, they are not preparing a solid plan when it comes to transferring the wealth to the next of kin. After the death of an individual, his/her closest people realize that they have been unaware of the financial picture, investments etc. It is important to hand over the legacy in a planned way. Succession planning is the biggest threat facing all families.
Unfortunately, many people put off their succession planning. You do not need to have crores in assets to plan. Succession planning is not only for the rich. Even the middle class must do it. Estate planning is not for the old. Even those in their late 30s and early 40s can do it. One thing is very clear. Planning your succession is not an exercise to be looked after retirement. Succession planning, when done well, will ensure passing down of your assets from one generation to another in a seamless manner.
What is Succession planning?
It refers to the passing assets and investments down from one generation to another, or from one person to another. As the owner, you decide how much of your estate you will pass on to whom and how, after your demise. It is accepted by the laws of the country. It is also known as Estate planning. One of the proper ways to do estate planning is writing a will.
Some of the basic questions regarding a WILL are answered below:
- What is a will?
It is a legal declaration of the intention. The one who makes the will is called the testator. The will tells people what the testator wishes to do with respect to his/her property after death. So, a will basically tells people what will happen to their assets after they die.
- Who can make a will and when?
Surprisingly, many do not know that a will can be prepared by anyone who is 18 years of age. You need to be of sound mind, and free from any coercion, fraud and undue influence when you wrote the will. You are never too young to prepare a will. A will bypasses unwanted complications. It ensures that your family will have a peaceful life.
- Can you revise a will?
Yes, you can always revise a will. It can be done an unlimited number of times but the process needs to be legally binding.
- When to make a will?
The truth is that people become incapacitated with old age. Some even lose their mind. The ability to comprehend greatly reduces. A will cannot be made at that stage. That is why it is advisable to prepare your will at a relatively young age when you are physically and mentally fit,
- Who should make a will?
There are 3 types of situations where a person should definitely make a will. If you are married or in a relationship, a will can give financial security to your partner, and give him/her a better future since you have planned it well. When you are married and have children along with dependents, writing a will is a good idea so that everybody gets their due. This will avoid disputes among dependents. If you are diagnosed with a terminal illness and if you haven’t written a will, this is the best time to do it.
- What assets covered by will?
All movable as well as immovable assets can be included. This means real estate, fixed deposits, money in bank account, stocks/securities, bonds, proceeds of insurance policies, retirement benefits, art, precious metals, goodwill, digital assets like photographs, blogs, websites, email accounts and social website profiles can be covered under a will. Simply put, any asset that the testator has ownership over, at the time of death, can be included and distributed as per the desire of the person.
8 Benefits of Will
- A proper and fair will avoids disputes within the family
- A will can make provisions for minor children and children with special needs
- A will can bypass relatives who may be troublemakers in the future
- A will enables s oath transfer of assets
- A will helps you choose your executor
- A will helps specify funeral wishes
- A will prevents legal grief
- A will brings in peace of mind and happiness for your relatives after your death
(Source: https://nsdl.co.in/publications/nsdlprimer.php)
Tags – financial planning
