Estate Planning: Should I draw up a Will?

Believe it or not, in the journey of financial freedom a.k.a wealth creation, preparing your will is one of the most important thing that one needs to do. In a person’s financial plan, if there’s no consideration of drawing up a will, then that financial plan is not complete.

The same as chicken curry is not complete if santan (coconut milk) is not added, a financial plan is not complete without a will.

It is also of my belief that you’re never too young to prepare a will. It doesn’t matter if you’re 18, 19, 21, 30, 40, as long as you own some assets, having a will is important. Let’s have a look at why this is so.

To make it easy for your beneficiary/beneficiaries

If one dies without a will (or dies intestate as they call it), his/her assets will be frozen. To release the assets, his family needs to go through certain procedures to get a Letter of Administration (LA). For assets worth less than RM600,000, the family needs to go to the district land administrator at the land office while assets worth more than RM600,000, the family needs to go to the court. This process can take somewhere between 6 months to 3 years. The time varies. In fact, it can take much longer than 3 years.

If you have a will on the other hand, the distribution of assets will take around 3 to 6 months. With a will, the family members only need to get the grant of probate. This way, it’ll make it easier and quicker for your family members, not to forget less costly.

Your Wish is My Command

With a will, you get to decide who gets what. In the will, you get to include detailed clauses on how your assets should be distributed. I’m sure most of us do not want our hard-earned assets being given to somebody who should not have been in the picture in the first place.

Without a will, your assets will be distributed according to the Distribution Act 1958 (amended in 1997), and one might not agree as to how it is distributed.

To Avoid Conflicts

This is true in most communities. How many cases have we heard about family members fighting with each other because the deceased did not leave a will? The 1st son says he should get more because he’s the eldest, the 3rd sister says she should get more because she’s the one been helping the deceased in his business ventures, and bla bla bla. Family ties get broken just because of the absence of a will.

Not only relationships get ruined, your estate distribution also will take much longer.

Ensure the Welfare of your Dependants

Not only a will deals with distributing your assets, you can also appoint a guardian and set up a trust to take care of your children.

Think about it, if you and your wife suddenly dies leaving a 4-year-old daughter, what’s going to happen to her? So, the lesson is to prepare for the worst-case scenario.

I hope this post has given an overview of the importance of having a will. Though it is considered as a taboo for some to plan for our own death, one must be realistic and prepare themselves for the worst-case scenario.

I myself am planning to prepare my own will before I return to Australia. Below are a couple of organisations that offer will-related services. If any of you out there knows any other organisations, do share in the comments section.

1. Amanah Raya Berhad

2. As-Salihin Berhad (Subsidiary of Rockwills Berhad)

P.S. This entry aims at exploring only the surface of the importance of a will. I suggest that you research into this matter further to get more details.

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About nadlique

This blog is about the journey of a 28-year-old Malaysian towards financial freedom. This blog was started back when the blogger was 21 years old. However, his journey towards financial freedom had begun way before that. Materials such as investing, business, entrepreneurship, equities, and real estate are presented. The author also posts his thoughts and observations on life in general.

Comments

  1. Hi Nadlique,

    Thanks for visiting my blog and sharing your thoughts!

    I absolutely agree that many people have neglected the importance of writing a will. Without one, it really makes their whatever financial planning incomplete! (i like your comparison with curry and santan!)

    It could simply be a state of ignorance or procrastination for many. However, when disaster strikes out of a sudden, it’s often the dependents that suffer the most!

    Actually, it does not cost much to prepare a will with the professional will writer. Best of all, it gives one the peace of mind, knowing that one’s dependents will be taken care of properly.

    Many people probably do not realise that they can also prepare a will by themselves. It’s as good as legal binding! However, it may not be such a good idea as they may overlook many possible scenarios. However, it’s still better than none!

  2. By the way, I have also responded to your comment made on “Contrarian Investing”. Please click this link to read my comment:
    Link

  3. Can’t put it better myself my friend 🙂

    Thanks for dropping by.

  4. Intestate outcomes vary according to the jurisdiction in which they occur. What is true in Malaysia may not be the case in Australia. Definitely, what is true in Texas will be different from reality in Vermont. I guess this means that everyone must consider their local situation. This becomes even more important for people who have moved from one state or country to another.

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  1. […] Naturally, upon his death, all of his assets will then be frozen (because he doesn’t have a will). Take note that all the bank accounts with substantial amount of money is under his name […]

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