How to write a foolproof Will to pass on your assets smoothly

Next, make a list of your assets. These would be your financial, movable and immovable assets. Suresh Sadagopan, Founder of Ladder7 Financial Advisories says that often people would have made investments years ago and forgotten about them. So, a complete inventory of your assets is crucial. You must know what you have before you give!

Distributing your assets

Keep the language simple. Sadagopan advises that the distribution of assets should be written in such simple style that there are no two ways of interpreting it. Start by taking stock of your wealth.

For your financial assets, leave behind instructions to pool everything together and then distribute. So, let’s say you have 10 mutual fund (MF) schemes and shares of 20 companies on the day when you write your Will. But if you die, say 30 years later, you could have an entirely new list of 20 MF schemes then. Or just five companies’ shares. Sadagopan says it becomes messy if you write stuff such as ‘I leave my MFs for my daughter’ or ‘I leave my shares for my son.’ People buy and sell MFs and shares all the time, so the list changes,” he says.

Be specific about your real estate, too. Write down complete addresses and locations of all your properties. Sadagopan says that when you leave your property behind, it’s better to leave one property to one person.

Harmonize your Will with your holdings

All financial assets, whether your MFs, bank accounts, lockers, bonds and so on, either have the option of including a joint holder or nominee. In simple words, a nominee or a joint holder facility enables ease of access to your money by your loved ones. But what happens if your nominations or joint ownership is different than what you have stated in your Will?

Sneha Makhija, Head of Wealth Planning at Sanctum Wealth Management says, that earlier there have been judgements in favour of the nominee under the Companies Act, 2013 whereby the nominee was considered the owner of the assets while under the Banking Regulation Act, 1949 the nominee was considered merely a custodian. However, a recent judgement by the Supreme Court overruled the earlier judgements to conclude that the Will should supersede such nominations. Therefore, the best rule to follow is to synchronize your joint holding pattern and nominations with the manner of bequest in your Will for ease of transmission of your assets to your intended recipients/beneficiaries.

Rajat Dutta, Founder & Initiator, Inheritance Needs Services rightly points out that most of us take registering nomination lightly without adequate thought, especially in our financial assets such as MFs. Take the case of a couple who invests in MFs. If they have a child, for instance, who lives in Canada, they would refrain from making the child a joint owner, due to income-tax concerns. Also in case of investments made jointly by a couple who undergo divorce proceedings and if there is no nominee, then the situation could be disastrous. While having nominations and joint holdings in investments are bound to address operational and administrative purposes, they surely support the Will which is the supreme document aiding transmission of assets.

Dutta has a solution. The administrative aspects should be well-documented to ease the operational aspects matched by a para in the Will for sake of adequate clarity and adherence to statutes: “All administrative aspects and nominations governing the financial assets are instituted for operational ease keeping in mind administrative and legal requirements but would in no manner supersede the bequeath as mentioned in the WILL.”

Can an executor be a beneficiary?

Every Will must have an executor. The executor carries out your Will’s instructions and ensures that money reaches the right hands. Can you appoint one of your beneficiaries as an executor or must he or she be an independent person?

Financial planner Gaurav Mashruwala says that an executor must not be the beneficiary. This, he says, avoids conflict of interest. Others say that appointing an independent executor is cumbersome. Financial advisor Sujata Kabraji says that if the estate is large and assets are too many and with several beneficiaries, it takes a lot of effort to untangle and distribute. “Let’s say a person was living in Mumbai and owned a property in Delhi. You’ve got to fly down to Delhi ever so often to dispose the property, perhaps even hire a lawyer. And if the Will gets contested, it creates complications,” she says.

Sadagopan says that it makes sense to have one of the beneficiaries as executors as, that way, the Will gets executed in a timely manner since the executor knows there’s something in it for them.

Should you register your Will?

Revisit your Will every few years, or if there is a marriage, death or separation in your family. Writing a Will is not a one-time exercise. Your priorities and choice of beneficiaries may also change over time.

It is not mandatory to register your will. But if you have immovable assets in Mumbai, Chennai or Kolkata, then, after your death, a Probate is required for the transmission. A registered Will, in such cases, reduces hassles for the executor. Also, by registering the Will, you have made the Sub-registrar (registering officer) a witness of the Will, which adds to its legitimacy.