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NSamant, 37, found out the hard way that being his father’s only legal heir was not enough to ensure smooth inheritance of his assets. The Bengaluru-based marketing manager lost his father to a sudden illness four years ago, but the legal battle that ensued between him and one of his paternal uncles over the ownership of a piece of land is still ongoing. “My father didn’t make a will, so I had to go to a magistrate and get a legal heirship certificate. By the time I got it, my uncle had already contested my claim to the property, since it was a shared plot," he said.
As news of acquaintances and relatives falling gravely ill or passing away due to covid-19 trickles in, the stark reality has emerged: there is a need to be prepared for the worst for yourself as well as your loved ones. Estate planning, which can ensure smooth inheritance, is one aspect of financial planning that is often ignored due to the taboos surrounding death. But putting it on the back-burner can mean trouble for your loved ones, like in the case of Samant.
“As per data from Press Information Bureau, in 2016, 76% of all cases pending in Indian courts were related to family and property disputes. Most of them could probably have been avoided with proper succession planning," said Raj K Lakhotia, founder, dilsewill.com, an online estate and succession planning platform.
Your family needs it
Estate planning is meant to smoothen things out for your family and loved ones after you are no more. Making a will is the most common mode to put estate planning in motion.
“In the absence of a will, the estate of the deceased person will flow under intestate succession law, which varies significantly by religion and gender. For instance, for Hindu males dying without a will, one of the major problems is that all heirs are entitled to joint and equal ownership to all assets, which includes their widow as well as all sons and daughters," said Rishabh Shroff, partner, Cyril Amarchand Mangaldas. This means each heir gets equal ownership in each asset, which can lead to disputes and complications if one of them wants to sell or transfer their share, as they have to seek the consent of all others. Then there are stamp duty, taxation and other factors to deal with.
A will can have many utilities beyond distributing your assets. “It can name a guardian for your children if you pass away before they reach adulthood; and leave specific instructions like arrangements for your funeral, organ donation, and a lot more," said Lakhotia.
No right age to do it
People often view retirement or death as a faraway probability and feel it’s not yet time to make a will. Some even feel they don’t have enough assets to make a will. But there’s no right or wrong age to do so.
Writing a will
Many assume that a will has to be registered for it to be valid, but that’s not true. “However, elderly clients, who are likely to have their wills challenged on grounds of mental infirmity or testamentary capacity, or clients who fear an attack on their estate from disgruntled family members, should register wills," said Shroff.
You will also need to appoint an executor to oversee your estate’s distribution in line with your wishes.
Remember that you can alter a will as many times as you want. “It is recommended that the will be revisited every three to five years due to changes in financial status, relationship status, and others," said Lakohtia. But it is a good idea to mention that it is the last will of the testator and any previous versions or codicils (amendments made to the earlier will) are invalid. “It is prudent to refer to previous wills and codicils in the last or current will. But even if it is not, the last will would be considered valid unless proved to be made under suspicious circumstances. Even if the last will is unregistered, it will supersede an earlier registered will," said Dutta.
Not only does having all your assets listed in one place, complete with all the details like where it is held, who the nominees are, whether it has a single holder or multiple, whether it is self-acquired or inherited, helps you get a clear picture when you’re drawing up a will, it also helps the executor in the distribution process.
While the idea of one’s own mortality can be difficult to grapple with, in these uncertain times it is more important than ever to secure the interests of your loved ones.
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