Why you need to WRITE A WILL
source: The Economic Times Wealth
If you want to distribute your assets among heirs, write a will irrespective of your age, income or net worth. It will ensure that your legacy does not get mired in legal disputes.
For the past six months, Delhi-based Padma Malhotra and her three children have been struggling to access what is rightfully theirs. They have been unable to lay hands on the financial assets of Malhotra’s husband, who passed away in January. The emotional trauma of losing him was followed by despair at not being able to withdraw the money lying in his bank account or access his other investments. This upheaval has been sparked by a single act of omission on the part of Malhotra’s husband—writing a will.
“My husband didn’t leave a will and had not named a nominee,” she says ruefully. So, she and her kids have been running from pillar to post to prove that they are the only legal heirs of the deceased. Malhotra’s husband has a substantial amount of money in his bank account, but it cannot be withdrawn till the bank is satisfied that there are no other claimants to these funds. “We have submitted copies of the death certificate and our ration card as well as a letter of indemnity, but the bank is demanding more documents. I don’t know how long it will be before we can use the money,” says Malhotra.
“My husband didn’t leave a will and had not named a nominee,” she says ruefully. So, she and her kids have been running from pillar to post to prove that they are the only legal heirs of the deceased. Malhotra’s husband has a substantial amount of money in his bank account, but it cannot be withdrawn till the bank is satisfied that there are no other claimants to these funds. “We have submitted copies of the death certificate and our ration card as well as a letter of indemnity, but the bank is demanding more documents. I don’t know how long it will be before we can use the money,” says Malhotra.
In Noida, 73-year-old RR Grover is not leaving anything to chance. He has experienced at close quarters how problematic it can be if the head of the family dies without leaving a will. “I don’t want my heirs to run around to get what is theirs. So I have drafted a will that spells out how the assets will be distributed among them,” he says.
Writing a will
Any adult who wants to distribute his assets
Any adult who wants to distribute his assets
Different types of wills
• UNPRIVILEGED WILL
This is a simple will written by an individual. Such a document needs to be signed by the person making the will in the presence of at least two witnesses, who attest the document. These wills can be revoked by writing a new will or destroying the old one.
• JOINT WILL
A joint will is written by two or more persons. Any of the testators can revoke the will during his lifetime. This is possible even after the death of the other testator(s).
• MUTUAL WILL
This will is usually penned by a couple. The two individuals can will their wealth to the other in case one of them dies. The surviving spouse becomes the sole owner of the couple’s wealth.
• CONDITIONAL WILL
If the will lays down any stipulations, it is a conditional will. For instance, a will can state that the assets are to be given to the heirs only after they fulfil certain conditions, such as getting married or having children. However, the condition cannot be outside the ambit of the law.
• PRIVILEGED WILL
The army personnel, who are in the battlefield or have undertaken an expedition, can write a will without any witnesses. These wills can be handwritten or even penned by another person. Such a will can be revoked by an unprivileged will. is a legal document for all practical purposes as long as it is signed by you and attested by two witnesses.
For most people, making a will can be a simple, do-it-yourself exercise. “The only requirement is that the will should be legible. If a person is old and frail, he should avoid writing it himself and get it typed to avoid disputes in the future,” says Amit Aggarwal, a lawyer with SNG & Partners, a Delhi-based law firm.
However, if there is a complication in the ownership of assets and wealth, you may need the help of a legal professional to draft the will. Such a person will ensure that there are no loopholes or ambiguity in the language that may lead to disputes later on. More importantly, he will make sure that the distribution is within the ambit of the law. “When it comes to making a will, people try to experiment, but the wishes of the testator should be legally enforceable. Therefore, consulting a professional on this matter is important,” says Pavan Duggal, a Delhi-based lawyer.
Legal viability
A will cannot override the natural succession of ancestral wealth. In other words, a person cannot will away the entire inherited property the way he wants to. He can pass on only his share to anybody he wants, but the remaining property can be willed only to the legal heirs. Suppose a Hindu man inherits 50 lakh from his father. If he has four legal heirs, then he has only a 20% share in that amount. The balance belongs to the four legal heirs. He can will his own share ( 10 lakh) as he wants, but cannot distribute the balance 40 lakh to somebody other than the four legal heirs.
In case you want to bequeath certain assets to people other than the natural heirs, you would need to mention the reason for doing so. This would foreclose the chances of any objection from other beneficiaries.
A will has to be attested by at least two witnesses and its important to choose them carefully. They should be completely reliable and preferably much younger than you are in order to ensure that they are alive when your will is being executed.
Sanjana Bali, a partner with KB Partners, a Delhi-based law firm, recounts a case in which the deceased had willed everything to one of his children. The other siblings filed an objection but the sole beneficiary could not prove the validity of the will because the witnesses could not be located. The matter was resolved only after the beneficiary agreed to split the assets with the other siblings.
Such cases bring into focus the role of the executor of the will. The executor is supposed to oversee the distribution of your assets according to your will. Here again, you need to be careful while choosing an executor. “Not only should he be a reliable person, but someone your heirs will be willing to listen to,” says Narendra Ahuja, a Delhi-based lawyer. If the asset distribution is not equitable, it can lead to squabbles, and unless the executor can resolve the differences, the matter may end up in court.
This is also the reason legal experts advise that the will should be registered. This is not mandatory, but it puts a stamp of authenticity on the document. If you want to get the will registered, it can cost you as little as 200-300. You can get it registered with a sub-registrar. To make it ironclad, use a stamp paper to make the will. One copy of the will is filed in the registrar records and the original is given back to the testator. “If a will is drafted properly and subsequently registered, any objections would lack teeth,” says Duggal.
Is gifting a better option?
It can be argued that instead of going through the rigmarole of making a will and apportioning assets among one’s heirs, one can simply gift them during one’s lifetime. However, gifting has its own limitations. For one, the process of gifting is irrevocable, that is, once the asset is given, it becomes the property of the receiver. Experts say it is risky for a person to give away all his assets during his lifetime and then be at the mercy of the beneficiaries.
On the other hand, an individual can change his will any number of times, deleting names and adding new ones as per his wish. If there is a minor change, it can be done by filing a codicil instead of rewriting the entire will. A codicil is a supplementary document which specifies the changes in the will. “One of the reasons people postpone making a will is the misconception that it cannot be altered. This is not true; you can make any number of changes,” says Ahuja. The latest will supersedes all previous documents.
Appoint a nominee
One seamless option of transferring assets to your heirs is to make them nominees. All financial investments (mutual funds, bank deposits, bonds, etc) offer this facility. However, while a nomination ensures a smooth transfer of assets, it does not make the nominee the sole owner of those assets. The other legal heirs of the individual can stake a claim to those assets.
In a case that came up before the Supreme Court in 1983, a life insurance policyholder died without writing a will, leaving behind his mother, wife and son. His wife was the nominee of the insurance policy, but his mother and his son filed petitions, both demanding a onethird share in the insurance amount. The court ruled in their favour, stating that the nomination only indicates that the person is authorised to receive the amount but is not the sole owner of that sum. “Few people are aware of this fact.
A will cannot override the natural succession of ancestral wealth. In other words, a person cannot will away the entire inherited property the way he wants to. He can pass on only his share to anybody he wants, but the remaining property can be willed only to the legal heirs. Suppose a Hindu man inherits 50 lakh from his father. If he has four legal heirs, then he has only a 20% share in that amount. The balance belongs to the four legal heirs. He can will his own share ( 10 lakh) as he wants, but cannot distribute the balance 40 lakh to somebody other than the four legal heirs.
In case you want to bequeath certain assets to people other than the natural heirs, you would need to mention the reason for doing so. This would foreclose the chances of any objection from other beneficiaries.
A will has to be attested by at least two witnesses and its important to choose them carefully. They should be completely reliable and preferably much younger than you are in order to ensure that they are alive when your will is being executed.
Sanjana Bali, a partner with KB Partners, a Delhi-based law firm, recounts a case in which the deceased had willed everything to one of his children. The other siblings filed an objection but the sole beneficiary could not prove the validity of the will because the witnesses could not be located. The matter was resolved only after the beneficiary agreed to split the assets with the other siblings.
Such cases bring into focus the role of the executor of the will. The executor is supposed to oversee the distribution of your assets according to your will. Here again, you need to be careful while choosing an executor. “Not only should he be a reliable person, but someone your heirs will be willing to listen to,” says Narendra Ahuja, a Delhi-based lawyer. If the asset distribution is not equitable, it can lead to squabbles, and unless the executor can resolve the differences, the matter may end up in court.
This is also the reason legal experts advise that the will should be registered. This is not mandatory, but it puts a stamp of authenticity on the document. If you want to get the will registered, it can cost you as little as 200-300. You can get it registered with a sub-registrar. To make it ironclad, use a stamp paper to make the will. One copy of the will is filed in the registrar records and the original is given back to the testator. “If a will is drafted properly and subsequently registered, any objections would lack teeth,” says Duggal.
Is gifting a better option?
It can be argued that instead of going through the rigmarole of making a will and apportioning assets among one’s heirs, one can simply gift them during one’s lifetime. However, gifting has its own limitations. For one, the process of gifting is irrevocable, that is, once the asset is given, it becomes the property of the receiver. Experts say it is risky for a person to give away all his assets during his lifetime and then be at the mercy of the beneficiaries.
On the other hand, an individual can change his will any number of times, deleting names and adding new ones as per his wish. If there is a minor change, it can be done by filing a codicil instead of rewriting the entire will. A codicil is a supplementary document which specifies the changes in the will. “One of the reasons people postpone making a will is the misconception that it cannot be altered. This is not true; you can make any number of changes,” says Ahuja. The latest will supersedes all previous documents.
Appoint a nominee
One seamless option of transferring assets to your heirs is to make them nominees. All financial investments (mutual funds, bank deposits, bonds, etc) offer this facility. However, while a nomination ensures a smooth transfer of assets, it does not make the nominee the sole owner of those assets. The other legal heirs of the individual can stake a claim to those assets.
In a case that came up before the Supreme Court in 1983, a life insurance policyholder died without writing a will, leaving behind his mother, wife and son. His wife was the nominee of the insurance policy, but his mother and his son filed petitions, both demanding a onethird share in the insurance amount. The court ruled in their favour, stating that the nomination only indicates that the person is authorised to receive the amount but is not the sole owner of that sum. “Few people are aware of this fact.
Making a will online
If you are tech savvy, you can get a will made online. A few companies such as Warmond Trustees & Executors and Vakilno1.comoffer this service. To make a will online, you need to register with the company and key in your personal and financial information. Once the details are uploaded, the company drafts a will and sends it to you within seven days. Besides making the will, these companies help with the registration and also act as an executor. The cost of this convenience: 10,000. However, this option works only if you have a simple portfolio and there are no conditions involved in the distribution of assets. “This is because any will with a complex structure requires a one-on-one discussion. So the online format works only for a simple portfolio,” says Sandeep Nerlekar, MD and CEO, Warmond Trustees & Executors. In case you want an online will, you need to have a digital signature for signing it. The two witnesses must also have digital signatures. “Not everyone has digital signature and finding witnesses who have them is even more difficult,” says Duggal.
If there is no will, the estate of the deceased is distributed in accordance with the law of succession. However, such cases usually end up in court or are settled after acrimonious negotiations between the legal heirs. There is also a cost attached. If you apply for a succession certificate from the court because there’s no will, you need to pay up to 3% of the value of the assets. This is why you should settle these issues during your lifetime. “A will is a legal document that clearly demarcates what should go to whom and bypasses all succession laws. It reduces the chances of dispute and lessens emotional distress,” says Bali. So, in case you have not thought about succession, it’s time to stop procrastinating and start penning your legacy.
If you are tech savvy, you can get a will made online. A few companies such as Warmond Trustees & Executors and Vakilno1.comoffer this service. To make a will online, you need to register with the company and key in your personal and financial information. Once the details are uploaded, the company drafts a will and sends it to you within seven days. Besides making the will, these companies help with the registration and also act as an executor. The cost of this convenience: 10,000. However, this option works only if you have a simple portfolio and there are no conditions involved in the distribution of assets. “This is because any will with a complex structure requires a one-on-one discussion. So the online format works only for a simple portfolio,” says Sandeep Nerlekar, MD and CEO, Warmond Trustees & Executors. In case you want an online will, you need to have a digital signature for signing it. The two witnesses must also have digital signatures. “Not everyone has digital signature and finding witnesses who have them is even more difficult,” says Duggal.
If there is no will, the estate of the deceased is distributed in accordance with the law of succession. However, such cases usually end up in court or are settled after acrimonious negotiations between the legal heirs. There is also a cost attached. If you apply for a succession certificate from the court because there’s no will, you need to pay up to 3% of the value of the assets. This is why you should settle these issues during your lifetime. “A will is a legal document that clearly demarcates what should go to whom and bypasses all succession laws. It reduces the chances of dispute and lessens emotional distress,” says Bali. So, in case you have not thought about succession, it’s time to stop procrastinating and start penning your legacy.
CASE-STUDY
Padma Malhotra 47 years, Delhi
Her husband died without appointing a nominee to his bank account. For the past seven months, she and her three children have been completing the legal formalities to gain access to the money.
can write a will. The assets can include property, gold, financial investments, art and artefacts, even hard cash lying at home. It’s a myth that only the super-rich need to write wills. “Whether you are a daily wage earner or a tycoon, you have the right to dispose of the assets you own according to your wish,” says Rajesh Dalmia, a Kolkata-based certified financial planner. A will is an instrument that allows you to do so.
Contrary to perception, it is not necessary to write it on a stamp paper or even get it registered. You can write a will on plain paper and it will be as legally valid as one prepared by a lawyer. All it should do is identify you as the testator (or the person who is making the will), list out your assets and specify how these are to be distributed among the beneficiaries. Whether you type it out or write it down, it
Her husband died without appointing a nominee to his bank account. For the past seven months, she and her three children have been completing the legal formalities to gain access to the money.
can write a will. The assets can include property, gold, financial investments, art and artefacts, even hard cash lying at home. It’s a myth that only the super-rich need to write wills. “Whether you are a daily wage earner or a tycoon, you have the right to dispose of the assets you own according to your wish,” says Rajesh Dalmia, a Kolkata-based certified financial planner. A will is an instrument that allows you to do so.
Contrary to perception, it is not necessary to write it on a stamp paper or even get it registered. You can write a will on plain paper and it will be as legally valid as one prepared by a lawyer. All it should do is identify you as the testator (or the person who is making the will), list out your assets and specify how these are to be distributed among the beneficiaries. Whether you type it out or write it down, it
Paurav Mehta 33 years Mumbai
His father died in 2009 without leaving a will. But since he had made his wife a nominee in all the bank accounts and other financial assets, the family did not face any trouble in accessing these.
His father died in 2009 without leaving a will. But since he had made his wife a nominee in all the bank accounts and other financial assets, the family did not face any trouble in accessing these.
RRGrover 73 years, Noida
Even though his wife is the joint owner for most of his assets, Grover has drafted a will for a smooth distribution of wealth among his wife and two daughters.
Even though his wife is the joint owner for most of his assets, Grover has drafted a will for a smooth distribution of wealth among his wife and two daughters.
Mohan Hirani 66 years, Delhi
When his father expired without leaving a will, it took him a year to get the succession certificate for transfer of shares. To avoid such problems, he has drafted a joint will with his wife and is to get it registered soon.
Most believe that the nominee will also be owner of the assets,” says Veer Sardesai, a Punebased certified financial planner.
When his father expired without leaving a will, it took him a year to get the succession certificate for transfer of shares. To avoid such problems, he has drafted a joint will with his wife and is to get it registered soon.
Most believe that the nominee will also be owner of the assets,” says Veer Sardesai, a Punebased certified financial planner.
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