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Do you know a certain event that would occur at some point of time, but still you don’t want to talk or even think about that? For everyone who is alive, this event is sure to happen and cannot prevent.  Yes, you guessed it right, its the DEATH.  Everyone who has born has to undergo this process.  When and where is uncertain and not under your control.

Have you ever thought about what happens after your death to all your hard earned assets?  You may assume that it goes to the right hands and to those persons you want it to go to.  Have you done anything for that?  Well… not sure ?  Here is when Nominations and WILLS come into picture.

As per the laws of our country, all assets of a person will go to his successors as per WILL or as per the respective law like Succession Act, Hindu Laws, Muslim Laws etc.  The WILL will have the first priority and then other respective succession laws will come into picture.

What is a WILL?

WILL can be explained as a legal declaration of a person’s intention which he wishes to be performed after his death and once the WILL is made by the testator it can only be revoked during his lifetime.

This means that WILL is a document which contains how your properties would be distributed and to whom and at what time after your death.  Also, the law provides that a WILL can be modified or revoked any number of times till a person’s death and the last WILL will be considered as the Final WILL.

Why there should be a WILL ?

You are healthy and does not foresee any threat to your life in the near future and do not expect your family to fight over your assets at any point in time.  Another popular belief is that you make a WILL only when you are old or when you are seriously ill.  If these are the notions you are having, then you are terribly wrong.

Death can happen to anybody at any point of time.  So, creating a WILL is not related to old age or illness.  It is for your benefit that all your assets and estates should be clearly identified and planned to be distributed among your successors.

There have been instances when a person dies, his immediate family is not even aware of his assets and its whereabouts. Many of your investments are confidential and sometimes even the spouse may not be aware of.  There have been instances when the assets reach in wrong hands and last but not the least, there have been instances where in fights have started between the close family members on the estate of the deceased person, very soon after his death.

Thus, creating a WILL will make sure that all your hard earned assets are identified, taken charge of and reach the right people you wanted it to reach even after you have left this world.

One more advantage is that, when you make the WILL, you start listing out your assets and this would clearly give you a picture of how healthy or unhealthy your finances are.

How to make a WILL?

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A WILL can be a simple handwritten document and prepared with contents or sections as required by the law.  You need not approach a lawyer or an expert to create a WILL, however in case you feel it is going to be complex and would require some sort of legal advices, please approach a lawyer to prepare a WILL.  You can make any number of WILLs as long as you are alive.

A WILL should contain the following sections:

  • Heading
  • Properties – their description and the beneficiaries
  • Name any sole beneficiary or multiple beneficiaries and their share
  • Name the executor
  • Closing
  • Signature and attestation

You can get a better clarity once you refer to the Sample WILL format link given elsewhere in this blog.

 

To be legally valid, the following conditions should be met:

  1. The person making the WILL should not be a minor.
  2. It should clearly indicate the details of the person making the WILL like name, son of/wife of, age, address etc.
  3. It should clearly specify that this is the last WILL and all previous WILLS are revoked
  4. It should clearly specify that the person is of sound mind and health and making the WILL not under the influence of others.
  5. It should be signed (or by way of thumb impression) by the person making the WILL in the presence of the witnesses.
  6. It should contain 2 witnesses.

Desirable Stuff for a WILL:

  1. Make the WILL in hard and good quality paper so that it is not spoiled easily.
  2. Make sure that all the assets are listed.
  3. Make sure that the mentioned assets are distributed in a clear manner.
  4. Clearly mention the full names and if possible relation or other identification of the beneficiary so that there is no confusion in the identity of the person.
  5. Get the WILL witnessed by reliable persons.
  6. Make sure that apart from the assets mentioned specifically in the WILL, there is a provision for any missing assets or assets acquired after the date of the WILL by providing a general condition like, “All my remaining assets will go to…”
  7. Make sure that your Executor know where the WILL is kept.

A Sample WILL can be found here: Sample Will

Nomination:

You would have come across many instances when you fill your nomination form.  Nomination is the act of naming a person who will receive the benefit on your behalf on your death.  Though Nominee will receive the asset on your behalf, he/she is not entitled to enjoy the same.  He is just a custodian to your assets and supposed to distribute the same as per the prevailing laws or WILL.  Only thing he can take is the expenses incurred in terms of taking the possession, storage and distribution of that particular asset.  Then why does the bank or other institutions look for a nominee?  Prima facie, its for their benefit.  If no nominee is given, they would be a party to any legal fights for the asset and it may take years for them before it gets settled.  So, in order to reduce such burden, they will ask for a nominee and their liability ends once the asset is given to the nominee.  This reduces the legal complications to a certain extent, as it is for the legal heirs now to get it settled from the nominee.

There are some exceptions like shares and debentures and apartments in Maharashtra where in ownership transfers to the nominee.

Difference between Nomination and WILL is that while nomination identifies the person who can be a custodian of your assets, WILL ensures distribution of your assets to your heirs in the way you wanted.

A nominee also can be changed anytime at the behest of the owner of the asset.  Subsequent nomination suprecedes the previous nominations.

So, what should you do? Nomination or a WILL?

I would recommend both, as nomination would help in receiving the assets/amounts due without any legal hassles and the WILL ensures its distribution in a manner desired by you.