Login
EN
CN

Estate Planners And Do I Need One?

Estate planning is essential for everyone whether you are rich or not, but it can be complicated to do it on your own. This article explains what estate planning is, its importance, who estate planners are and do you need them?
Alvin T'ngThu Aug 05 2021

## What is estate planning ?

Estate planning is the process of determining and arranging what will happen to your assets and properties, and how they will be distributed after you die; it’s about making sure that they will be distributed in accordance with your wishes. More importantly, estate planning is about making sure that your loved ones who rely on you financially are safe and secure. Sound estate planning usually involves drafting a will [1] and, at times, also drafting a lasting power of attorney [2].

What can be considered as your estate ?

An estate consists of everything a person owns or controls; it includes both real estate and personal estate[3]. In other words, your estate includes land, properties, vehicles, shares, money, businesses, jewellery, bank accounts, etc. Please note that this does not include monies in your CPF[4].

Is estate planning only for the wealthy ?

There is a misconception that estate planning is only for the wealthy. In fact, planning your estate is extremely important whether you are rich or not, especially if you have people that you care about, and you want them to be financially secure when you die.

Most people in Singapore own a property in the form of a HDB and that these properties may range from $300,000 to $1,000,000. In addition to that, most people in Singapore have insurance policies in place such that in the event of death, payouts that may range from $100,000 to $1,000,000 may be made by the insurer.

This means that in the event of death, most Singaporeans’ assets and properties are probably worth at least $400,000. The allocation of this sum should be carefully handled. With this in mind, estate planning is not only useful or a mere advantage but becomes necessary even for the average Singaporean.

Why should you plan your estate ?

Estate planning is extremely important for the reasons listed below.

You will have control over how your assets and properties are going to be distributed after you die.

By planning your estate, you will have more control over how your assets and properties will be distributed and who will be your beneficiaries[5]. In contrast, if you died without planning your estate and writing a valid will, your assets and properties will be distributed according to the rules of the Intestate Succession Act (Cap. 146)[6].

You will have control over who takes care of your child/children.

Drafting a will and planning your estate allows you to make sure that your child/children will receive the appropriate care and protection when you pass away. This is done by appointing a testamentary guardian in your will. Upon your death, this testamentary guardian will become the legal guardian of your child/children and will be responsible for their welfare and care.

Keep in mind, that this testamentary guardian will be solely responsible for your child/children only if both you and your spouse are not alive. If you pass away, and your spouse is still alive, then the testamentary guardian may become jointly responsible for your child/children should your spouse agree [7].

In contrast, where both parents have passed away, and in the absence of a will that appoints a guardian, the court may appoint any person, if it thinks fit, to be the child’s/children’s guardian on the application of that person [8], and this process might take some time.

In order to ensure that your child/children receive the appropriate care and protection, you should plan your estate by drafting a will and appointing a guardian for your child/children that you trust.

You will have control over who manages and distributes the assets and properties in your estate.

One of the reasons that everyone should plan his/her estate is that you will be able to choose who manages and distributes the assets and properties in your estate.

Drafting your will enables you to appoint an executor; executors manage, administer and distribute the assets and properties in your estate after you die. An Executor gets his authority from your will. Therefore, it is possible for him to represent your estate in legal matters even before he receives the grant of probate[9], which will save time and effort. Accordingly, engaging in estate planning allows you to choose someone that you trust to appoint as your executor.

In contrast, if you don't plan your estate and appoint an executor, the court will appoint someone to distribute and manage your assets and properties. This person is called an Administrator; administrators and executors have similar responsibilities, they both pay off any debts or taxes, manage your business and distribute your assets and properties. More importantly, both executors and administrators have the ability to sell your assets and properties.

This is crucial if you own shares in a business, because if you died without drafting a will and appointing an executor, the court will appoint an administrator to manage your business and assets. This may harm your business for two reasons:

First, an administrator needs to be granted a letter of administration from the court to be able to manage your business, vote in board meetings and exercise all the rights that you were entitled to. This process might take several months to finish, which can possibly affect your business negatively.

Second, this administrator might not understand your business and how it works. Accordingly, this can also negatively affect your business, and an unqualified person might even drive your business to bankruptcy. That’s why you should plan your estate and choose someone you can trust and has the ability to run your business to appoint as your executor.

When choosing your executor you should pick someone who understands your business(if you have one), trustworthy, knows your wishes and respects them. Above all, an executor must be of a sound mind and not a bankrupt. Also, you can appoint up to four executors.

Avoiding disputes and expediting the whole process

First, estate planning ensures that your assets and properties will be distributed the way you want them to be, and that they will be quickly and easily transferred to your beneficiaries. Having a will states your intentions clearly and unambiguously, reducing the possibility of family disputes over your estate.

Second, the distribution of your assets and properties might be delayed, since the time taken for the distribution of your assets and properties in a situation where there is no will is usually 3-6 months longer than if you had a will. This will be an issue in situations where your beneficiaries are in urgent need of money, for example if your family needs money to pay medical bills immediately.

Your family deserves to be able to use your money when they need it the most.

Who are estate planners, do you need them and how much do they charge?

Estate Planners assist you with drafting your will, determining your beneficiaries, establishing a lasting power of attorney, appointing an executor and a guardian. But, do you really need them?

Sometimes planning your estate and consequently drafting a will might be complicated especially if you have a large family and a huge amount of assets that may span several countries. Further, if your will turns out to be invalid, then your estate will be distributed according to the Intestate Succession Act (Cap. 146), and therefore might not be distributed in accordance with your wishes. In such cases, you may need to engage an estate planner.

However, hiring an estate planner to assist you in planning your estate and drafting your will might be expensive. For instance, drafting a simple will can cost you upwards of $500.

Fortunately, there is a great inexpensive alternative, which is drafting your will with WillCraft. WillCraft is a user-friendly and affordable method that helps you draft your will in 30 minutes. At WillCraft, we guide you through the whole process. Our platform allows you to appoint your desired executor, appoint a guardian for your child/children, determine your beneficiaries and you can even choose one of our legal service providers and have a lawyer review and witness your will.

While hiring an estate planner can cost you upwards of $500, at WillCraft you can draft your will right now starting from $49 only. Drafting your will with willCraft is probably the most convenient, affordable and easy to use method to plan your estate.

Conclusion.

Everyone should plan his/her estate. It is the best way to protect your family, provide for them and provide for yourself even if you became disabled. As we mentioned, the consequences for not planning your estate are serious, and they might bring unintended harm to your loved ones. That’s why you should start planning your estate and consider drafting a will so that you can keep your loved ones safe and secure.

[1] A will is a legal document that allows you, the testator, to manage and dictate how your assets are going to be distributed. [2] A lasting power of attorney is a document that allows any one 21 years old or above “Donor” to appoint a person“ Donee” that he trusts to make decisions for him and act on his behalf if he lost his mental capacity at any time in the future. The donee would be authorized to make decisions concerning both the donor’s personal welfare and property and affairs. [3] Wills Act (Cap. 352) Section 2. [4] Central Provident Fund Board. (2015, December 9). CPF monies not covered by a will. Retrieved from https://www.cpf.gov.sg/members/News/news-categories-info/forum-replies/2306 Accessed on [2019, September 9]. [5] People who will inherit and benefit under your will. [6] It is the act regulating the distribution of properties when a person dies intestate, it came into force on June 2nd 1967, but nothing in this act applies to the estate of any Muslim; as the distribution of Muslims’ estate after death is regulated under The Administration Of Muslim Law Act (Cap. 3). [7] Guardianship of Infants Act (Cap. 122) Section 6 (1). [8] Guardianship of Infants Act (Cap. 122) Section 6 (3). [9] According to section (2) of the Probate and Administration Act (Cap. 251), probate means a “ grant under the seal of the court issuing the same, authorizing the executor or executors expressly or impliedly appointed by a testator’s will, or one or more of them, to administer the testator’s estate in compliance with the directions contained in his will, and in accordance with law.”


About Us

WillCraft is set up by ex-lawyers who don't think Personal Legal Services should cost half as much as they do.

So we've priced our service at a fraction of what going to a traditional law firm would normally cost.

If you like what we're doing (or not), let us know - we're always looking to improve!

Contact Us

WillCraft and Draftiy Pte. Ltd. are not law firms and are not permitted to engage in the practice of law. The information and service provided is not a substitute for the advice of a lawyer, and is not legal advice. For more details, see our Terms & Conditions and Privacy Policy.