Legal commentary: Plan for life after your death
There are few things that are certain in life. Unfortunately, one of those things that everyone can be certain of, is that we are all going to pass on someday. We looked it up and its true – nobody lives forever. What sometimes we don’t realise however, is that part of us “lives” on after our death – our estate and our legacy.
Our estate lives on after our death, and it can either be a source of protection and benefit in accordance with our wishes, or it can be a source of dispute and unhappiness.
Most of us work hard and make plans to provide for and take care of our loved ones and families. We buy houses, put away money, and take out insurance policies to ensure that no matter what happens to us, they will be provided for. Some of us also give back to society and contribute to charities and other social causes.
Now imagine a situation where suddenly, our ability to make and give effect to those plans is taken away from us. A situation where we cannot decide which of our loved ones may stay in our houses, or receive money from us.
As you may have guessed, that is what could happen when we die. In Singapore, if a person passes on without a will, his estate will be distributed in accordance with the Intestate Succession Act. The Intestate Succession Act only provides for default and very general rules as to how a person’s estate shall be distributed, which may not be how a person wishes to distribute his assets. For example, under the Act, when a married person passes on, his estate is distributed to his spouse and children (if any), only. This means that other loved ones like aged parents and siblings will not receive any portion of his estate.
Matters are further complicated if we pass on whilst our children are still minors. They cannot receive their inheritance directly, and appropriate guardians may not be readily available. As people get married later in life, the age gaps between them and their children are bigger than ever. Even if the children can legally hold property, inheriting a large estate at a young age can have a negative effect on them. For Singaporeans with Central Provident Fund monies, arrangements for the distribution of these monies ought to be made as well.
Since we put in so much effort to make plans to take care of our families and loved ones while we are alive, it makes sense to give thought and make sure that those plans continue after we are no longer alive. One way to avoid disputes and unhappiness over our estate after our passing, is to make a will setting out specific instructions as to how our estate should be distributed or administered.
It is the stark reality that families have been torn apart from disputes over inheritances, and what often happen is that while those disputes are being resolved the people who need the money most, aged dependents and children, have limited or no access to the money that they need.
In our next article, we will explore some of the common misconceptions that people have about making wills and planning their estate. For example; that you have to be exceptionally wealthy before you do so, or that you are too young to think about these things.