A standard way of looking at a Will is it is about setting your affairs in order post death. The most basic format would be a dispensation of properties, monies in bank accounts, your Employment Provident Fund (EPF), company stocks, etc.
It is a fairly standard document, which as long as your can clearly write your wishes down and have it stamped & witnessed, is generally valid unless contested by some of the beneficiaries.
There are wider options available for the management of wealth while you are still alive as well as ensuring the desired outcome of certain instructions or arrangements after your death:
1. Gifted Inheritance/Wealth. - Itemising each property/monetary/corporate assets to each child for them to spend at their own discretion.
2. Living Trust – Allowing trustors (parents) to distribute wealth to trustees/beneficiaries (children) while still living and still hold control over said assets, monies, and properties until death.
Estate Planning : Types of Living Trust - Setting Up A Trust
Depending on the type of Trusts and the terms involved, a trust can be revocable and irrevocable.
1. Revocable Trust - The trustor maintains legal ownership and control of trust assets. The trustor can change beneficiaries of a revocable trust after it has been established.
2. Irrevocable Trust – The trustor passes legal ownership of the trust assets to a trustee. In this arrangement, a trustor cannot amend the names of beneficiaries of an irrevocable trust after it has been established.
There are also different types of Revocable and Irrevocable Trusts:
It is important to keep in mind why you decide to set up a trust: which is to ensure that there is effective and meaningful management of the wealth for the intended beneficiaries.
1. Family Maintenance Trust
a. Dispensation of specific amounts of money to ensure children’s’ basic needs are cared for in situations where the parents are divorced/separated.
2. Children Education Trust
a. This sets out clear terms setting out the intention that specific amounts of money are set aside purely for educational purposes.
3. Elderly Parent Trust
a. For adult caregivers, to ensure that our elderly parents are cared for in the event of untimely death particularly for their daily and medical expenses. This is usually when the adult child is unable to be present with their elderly parents and had to delegate caregiving to others.
4. Long Term Care Trust
a. Suitable for family situations where there are special needs persons or those with pre-existing medical conditions, usually in long-term nursing care homes.
b. It is also suitable for the elderly who plans their own care needs ahead or slowly losing their cognitive capacity to make their own medical decisions; that when they are no longer able to make decisions for themselves, there are clear instructions on what their wishes are, and that it is honoured.
5. Charitable Trust
a. For those who intend a specific amount to be set aside for charitable purposes, to be reinvested, and ensuring the sustainability of philanthropic endeavours.
6. Property Trust
a. This is common amongst families who want to distribute properties amongst their children but still retain control over said properties/assets.
b. Properties are placed into a trust controlled by the trustee (the original owner, normally parent) on behalf of the trustor's beneficiaries (the adult children/etc). Estate planning allows for trust property to pass directly to the designated beneficiaries upon the trustor's death without probate.
For those who have substantial amounts of assets and properties, thinking ahead on Estate Planning gives you peace of mind and assurance that all your wishes and instructions are followed to the letter whether you still want to retain control over the assets or you wish for it to be administered by a trusted person on your behalf.
This is intended as general guidance, not actual legal advice. Please contact me at aziraaziz.law@gmail.com or fill up a form at www.aziraaziz.com for detailed legal services related to above, or anything at all related to law and policy.