23rd April 2021
ESTATE PLANNING – MORE THAN JUST A WILL
Sometime last year, we were all unexpectedly plucked out of our normal ways of life and plunged into a whole new system by the outbreak of the Corona Virus as no one anticipated the coming of the pandemic.
There is no doubt that the effect of the nationwide lockdown still lingers and have disrupted many families through the unexpected loss of their benefactors. Rather than spend more time contemplating on what steps should have been taken prior to the pandemic, now is the time to put plans together to forestall any future exigencies.
One of such vital plans to be made are plans towards ensuring that your assets are preserved, managed and distributed properly, should the unexpected happen– This important act is called “Estate planning”.
Estate planning is the greatest legacy and the best everlasting gift you can give your family; and this is premised on the fact that whether or not you consider yourself average or rich, the occurrence of an emergency[1] is inevitable and without an estate plan in place, your loved ones are most likely to grapple an unsettling and negative experience that may last for a very long time.
What is Estate Planning?
“Estate Planning” [1] goes beyond estate management, preparation of a Will, creating a trust etcetera. It is generally the identification of all your assets and liabilities and the determination and implementation of the most suitable strategy for the management, control and preservation of your assets to ensure seamless devolution of same to your beneficiaries in a cost-efficient manner.
It encompasses a myriad of procedures and activities taken towards managing all of your assets and liabilities and the preparation of relevant documentations.
Essentially, there are three basic phases and activities that encompass estate planning:
1. Legal Audit phase:
During an estate planning exercise, you will find out that what you own, what you owe, the legal status and obligations attached to what you own and how they can affect you, now and in the future.
The specific activities under this phase includes the collation of all relevant personal information and documentations; the preparation of a personal profile; the preparation of an Asset Inventory (Register of Assets and Liabilities – RAL); the conduct of Due Diligence and document validation exercise – discovery of legal status and obligations attached to the assets and liabilities; document validation; and the preparation of a report on the discoveries and findings gotten from the due diligence conducted.
2. Planning Phase:
Upon collating your legal and financial information/documentations, a suitable estate planning strategy and portfolio is developed to properly manage your assets. This strategy must be tailored to meet your specific need.
3. Post-planning phase (Strategy implementation phase):
Towards the implementation of the developed strategy, certain processes and documents are put together:
- Living Trusts – This document, which is often used to simplify probate, creates a revocable trust in which the named trustees hold and manage your assets in your life time. Your funeral wishes, how your assets are to be handled in event of your incapacitation and the name the persons who will be beneficiaries of your assets upon your demise may also be captured in this document;
- Deeds of Gifts – This document, which also simplifies probate, is utilised to enable you to gift tangible and intangible property to your loved ones. Whilst this is similar to a Will, it is a simpler way to transfer assets.
- Powers of Attorney – This document, which is usually revocable, can be utilised to appoint trusted family members, friend or professional advisers as an agent to act on your behalf for certain financial matters.
- Wills and Codicils – These documents are instruments for the distribution of assets, the creation of trusts and the appointment of personal representatives [Trustees] and/or Executors to administer the distribution of your assets as you desire. You can also appoint guardians for minor children under a Will.
- Civil Planning: You certainly want to secure the safety and comfort of yourself and your loved ones. This covers areas such as immigration issues, civil partnerships, child welfare etcetera.
- Benevolent Planning: This includes donating to certain non-profit groups can create tax breaks for you.
Conclusion
Notwithstanding the above procedures and documentations, it is beneficial to have a team of financial, tax and legal professionals to guide you through the process and provide a bespoke advice which is dependent on the complexity of your estate.
Furthermore, it is noteworthy that a comprehensive estate plan makes provision for a periodic review due to changes in laws, and one’s personal life such as marriage, divorce, or the birth or death of a family member.
In the event that you require further information and clarification with respect to the above, kindly contact the us via our email info@wigweandpartners.com and we will be happy to explain and address any concerns you may have with utmost discretion and confidentiality.
Remember!!!! planning your estate saves you and your family from present and future hardship. Protect your family and help your friends today.
[1] Death or incapacitation [2] “Estate” in this context includes tangible and intangible assets – estate includes a person’s belongings, physical and intangible assets, land and real estate, investments, collectibles, furnishings etc; it is the economic valuation of all the investments, assets, and interests of an individual.