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Discuss this Article | Email this Article | Print this Article How to make your own Will |
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The entire nation watched as the Ambani brothers split their father's wealth. While speculation continues about what went wrong, there is no denying the fact that the late Dhirubhai Ambani would have done well to leave a will.
Making a will is sensible because it leaves you to decide how your wealth is used. But unfortunately, most Indians simply forget to make a will.
Why make a Will?
Key points of laws of inheritance
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If you die intestate (that is, without making a will), your family will have to follow certain 'laws of succession,' in deciding how to split your assets. It is a misconception to believe that all the estate is automatically passed on to the spouse.
Children and relatives can also stake claim to the property. Laws of inheritance and succession are diverse and complicated.
This kind of division of assets is an expensive business as your family would have to hire the services of a lawyer and all the costs will be incurred out of your estate. So in effect, your family will get a diminished share.
Key points to remember while making a Will
The process of making a will is very simple. It requires no stamp duty or registration, although most experts advice that a will must be registered, so that it is in safe custody.
However, there are certain traps that you should watch out for. Says chartered accountant Vinay Singh, "One common mistake that people make is failing to appoint witnesses and trustworthy executors younger than themselves. In case of Hindus, another common mistake is the failure to state if the property is inherited or not."
The question of inheritance becomes important because no ancestral property can be assigned to any person. All rights on inherited property are acquired by birth.
A Will supercedes nominations
How to make a will?
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In the eyes of the law, a nominee is a trustee and he need not necessarily be a beneficiary to a will. Says Singh, "The nominee is merely a caretaker and the right to the property passes by will or if there is no will, under the personal law of the deceased."
This means that if there is a will, the nominee will only hold the assets as a caretaker trustee for the beneficiary. The nominee will be legally bound to transfer the nominated property to the beneficiary of the will. If there is no will, he will have to transfer to the legal heirs. So ideally, if a will is made, it would be better to name the nominee as the beneficiary to ensure that the distribution is smooth and efficient
For more on succession planning, click here.
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