7 Biggest Myths About Wills
Death is a taboo subject to many. Therefore, people choose to avoid discussion on the subject. However, the increasing number of deaths caused by the coronavirus pandemic globally has now brought home the possibility and fear of death to many people. With social distancing measures and lockdowns in place, you may find yourself having more time to plan for and focus on important and fundamental issues that matter to you. It may be an opportune time to prepare an estate plan if you do not already have one. A well thought out and properly executed estate plan will ensure that your loved ones are provided for when you are no longer around.
In this article, we address certain misconceptions about wills and why it is advisable and beneficial to seek the help and advice of a specialist trusts and estates legal professional to make your will.
1. I am not wealthy and I do not have many assets, so it is not necessary for me to make a will.
You don’t need to have vast wealth to make a will.
A will ensures that your assets (regardless of value) are left to the persons whom you intend to receive these assets after you pass on.
In fact, vulnerable family members in less well-to-do households will benefit from a properly executed will as that ensures that they receive the financial support to continue with their lives after the breadwinner passes.
It is also common for Singaporeans to own their homes. Your home may well be worth at least half a million dollars, and its value will continue to grow as you age. Most Singaporeans may also have life insurance policies, which will, upon one’s passing, pay out anything from a few hundred thousand to even a million or more dollars.
It only takes a small investment of time and money to make a proper will to ensure that your assets (which may continue to grow over the years) to be properly distributed after you are gone. Moreover, after one’s death, distribution of assets if one has a will would be much faster, cost- effective and easier process compared to if one does not have a will.
2. The law will provide for the distribution of my assets, so I do not need a will.
It is true that if you do not have a will, the state can provide for the distribution of your assets according to the Intestate Succession Act.
However, the intestacy laws may not be in accordance with your wishes, and can lead to the following unintended and undesirable consequences:
(a) Some of your loved ones may be left out.
For example, if you are an adult in your late 30s or early 40s who is married with children, and if your parents are still alive at the time of your death, your parents will not receive any of your assets. Under intestacy laws, 50 per cent. of your assets will go to your spouse and the remainder 50 per cent. to your children. You would have to rely on the goodwill of your surviving spouse to take care of and maintain your parents, and that is assuming they got along when you were alive!
Another example is that if you are in a committed relationship but not married, your partner would receive nothing at all from your estate.
(b) This may cause unhappiness amongst the family members.
While it is easy to divide monies in a bank account based on simple mathematics, family members may not see eye to eye when dividing personal possessions or immovable property. What does it mean to divide a property equally between all the surviving children? What happens if one sibling wishes to stay in the property with his wife and children, and the other wishes to sell the property. Would the former be required to pay rent to the other sibling, and if so, how much should the rent be? Alternatively, should he purchase his sibling’s share of the property, and what if he does not have the money to do so?
What about your jewellery and/or watches? Which child or relative should receive your diamond ring(s) or luxury watch(es)? Do you possess any paintings or carpets which may or may not have significant monetary value but of sentimental value to you?
The responses to these questions may not be straightforward, especially as relationships change and time passes.
If you have a preference as to how your assets should be distributed, it is important to make a will to ensure that your assets are distributed according to your wishes, and to make special provisions for your loved ones.
3. I only have one child so there will not be any inheritance dispute.
A will allows you to state who should act as the guardian for your child in the event that you and your spouse die before your child turns 21. If you do not have a will, the decision could be left to the family courts, who may choose a person that you or your spouse may not agree with.
Additionally, some may feel that their child, despite being of legal age, may be too young to manage a potentially significant sum of money. To address that concern, a trustee (who can be a trusted family member or an unrelated third party) can be appointed in a will to hold and manage the assets for the child until the child reaches a certain age or milestone. For example, the trustee can be instructed to earmark a sum of money for the child’s further education or for the purchase of the child’s first home. Significant assets can also be released to the child after he or she turns 30, or assets can be distributed to the child on a yearly basis. This gives parents the peace of mind that there is some supervision and control over the way their child will use the inheritance.
4. I have already distributed most of my wealth to my children in my lifetime.
Dividing up an estate can sadly lead to quarrels and damage relationships among your family members and can be expensive if the dispute escalates into protracted legal proceedings. In the absence of expressly written wishes, family members may have different interpretations of the actual intentions of a person who has passed away. Consider this illustration. You own 2 properties and have gifted your elder child one of these 2 properties in your lifetime. You co-own the second property with your younger child with the intention that, upon your passing, the property will be inherited by your younger child. These intentions may not have been made clear to both children and without a will, could remain unclear after your passing. Your elder child may have had a different expectation and may have thought that your (50 per cent.) share of the second property would be distributed equally to both children.
If friendly discussions fail, legal disputes may ensue between the children in future. This can be avoided if your intentions are made clear in a will.
5. Wills are for the elderly.
We will never know for sure when and how we will pass on. A death can occur when we least expect it. Without a will, distribution of your assets may take many months, and sometimes even years if it is legally disputed. Meanwhile, your loved ones, especially young children and elderly parents, will have no means of supporting themselves.
Making a will is simply a tool to plan ahead for the inevitable, whenever it may arrive. It will give you peace of mind knowing that those close to you will be taken care of when you are no longer around.
6. Making a will is complicated.
Some worry that making a will involves a full review of their finances and will take a long time to complete.
Depending on the size of your assets and the wishes you would like to make in your will, drawing up a will may only take a few days. The process usually requires a first meeting (or video- conference) where your legal adviser will discuss your needs with you and take your instructions, and a second meeting with your legal adviser to go through the final document and to sign it. Any other discussion on the contents of the will, if necessary, can take place by telephone call or e-mail.
You do not need to have all the latest details of your assets in order to prepare your will. All that is required is a broad idea of what your assets comprise so that your legal adviser can advise you accordingly. It is not necessary to produce evidence of your assets or a detailed breakdown of what you own.
7. Making a will is expensive, so I would rather do it myself.
A poorly written will is at risk of being invalid if it does not meet all the legal requirements. In addition, if there is any ambiguity or contradictory information in the will, this causes uncertainty and opens the possibility for the will to be contested in court, incurring unnecessary legal costs and causing distress for your loved ones.
Aside from ensuring that legal requirements are met, an experienced trusts and estates lawyer will understand the nuances of drafting the will to prevent ambiguity and uncertainty and minimise the possibility of litigation risks in future. He or she will also be able to advise you on what a will can or cannot do, and the steps that you may have to take to put your affairs in order. This is because they can help to implement them after a client has passed away (which is part of the process of extracting the grant of probate under the Probate and Administration Act, which only lawyers can carry out).
Mistakes in a will can be costly and potentially disrupt family harmony. Therefore, it is not advisable for one to minimise costs in this area simply because of the availability of cheaper solutions elsewhere. Seeking advice from a specialist trusts and estates lawyer may cost more, but the result is a will that is tailored specially for your needs and not based on a standard template or formula.
As part of our estate planning practice, we regularly advise on and prepare wills for our clients to help them to manage and distribute their wealth. Our experience in contentious disputes, including mental capacity, probate and inheritance related disputes, gives us an advantage as we are able to anticipate possible risks. This enables us to advise you on how best to structure your estate plan to avoid future disputes down the road.
We believe that it is only by getting to know each individual and family, and understanding their background, wishes and relationships, can we advise on and prepare wills that ensure families and relationships are protected.
A will made with us will be personal to you, bespoke and tailored specially for your needs and concerns.
If you would like to discuss any of these further, please do get in touch with us.
Jacqueline Chua, Managing Director
+65 6970 0518
Loo Liang Zhi, Associate
+65 6970 0528
Disclaimer: This article is intended for your general information only and does not constitute legal advice. Before taking any action or omitting to take any action in relation to the matters set out in the article above, you should consult a qualified legal advisor for specific advice for your circumstances. This article may not be reproduced, or transmitted in any form or by any means, in whole or in part, unless with prior written consent.
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