Last Updated on 10, April 2014
If you want to do estate planning, you can distribute your assets based on needs-based analysis:
- You should have already done a survivor-needs analysis which identify the amount each dependents should have. This analysis is done as part of the Protection Planning. Thus, each of these dependents must have at minimum this amount of money.
- Since dependents must have a roof over their head, you should ensure that the residential property is held in a testamentary trust. If you are holding a joint-tenant with your spouse, the house will automatically go to spouse. However, if spouse is already predeceased you, you become the sole owner and thus you must ensure the house is catered for in the Will. I would suggest holding the house in a testamentary trust so that your dependents can stay in it until they have grown up. Remember to appoint a trusted trustee for the house otherwise there is no guarantee that trustee will liquidate and run away with the sale proceeds. If you cannot find a trusted trustee, you can always appoint a corporate trustee.
- If there are any (a) children who are disabled (b) sons below aged 21 (c) unmarried daughters, you must make provision for them otherwise the Will can be contested. Also your spouse should also inherit some monies from you otherwise it can be contested too.
- If there is nothing much left to distribute, you stop here and start contacting the Will writer. If you still have some assets left, you will need to have a residual clause otherwise the Will will be partially intestate. In the residual clause, you can put your dependents. It is important to have substitute beneficiaries. Worst case scenario you can put charity or the name of your financial adviser!
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