Is Estate Planning Just About Wills and Trusts?

A lot of friends have asked me if Estate Planning is all about Wills and Trusts. Actually, this is just a part of the planning process. However there are other very important aspects involved. Here are some crucial Wills and Trusts matters you should take into account.

Diversifying Your Assets

Singaporeans are generally asset-rich but cash poor. That is because they invest in properties, commodities, etc. These assets are usually subject to the market volatility. When the market is bullish, the values of the assets will appreciate. However, if the market is bearish, the values of the assets will reduce. Depending on the severity of the market, the assets can also become a liability when the values of the assets fall below the debts owed to the bank. Therefore, it is important to determine if these assets should be diversified to avoid the assets becoming a liability. Life insurance is a form of assets, and it is important to consider it as part of your diversification of assets.

Determining the Ownership of your Assets

Some friends told me that they don’t have many assets, so they don’t need to have any Estate Planning. I believe that most people should be proud owners of at least a HDB flat. These are assets that we can leave behind for our loved ones. Another friend told me that his HDB flat would be owned by his wife, who is the joint tenant (most HDB ownership are joint-tenancy). However, they didn’t take into consideration if both husband and wife died at the same time, and what would happen to the HDB property or even the condominium. How about the bank accounts of the breadwinner of the house? When upon death, the bank will need to freeze the account before the court issues the Letter of Probate or Letter of Administration for the Executor or Administrator to distribute the assets. Ownership of the Immovable and Movable Properties need to be established now, or it will cause more delay when the properties are being distributed to loved ones.

Declaring Where the Assets are

While we are still around, we know where our assets are. But do our loved ones know where are they? Which bank is holding our deposits? Where are the movable and immovable properties? Though these may seem trivial, when the crunch comes, it can cause great hindrance in identifying the assets. Well, my wife knows where are my assets. But what if both my wife and I died in a car crash? Certainly, we will not be resurrected from the dead to instruct our loved ones on where to find our assets? Therefore, take stock of your assets and inform your loved ones of where are they located. A good estate planner will have a checklist and worksheet to help you plan all these, so nothing will be left unattended.

Most people will be unsure of where and how to start the process. What they need is someone who can guide them and assist them. There are qualified Estate Planners who can assist and advise you on the process. It will be a consultative approach, where two parties will need to discuss on how to get things going. So why wait? Talk to a qualified Estate Planner now!