Many people in Singapore die without making a will, either because they put it off until too late or because they consider it inauspicious to consider such morbid issues while they are still alive. Some people even assume that wills are only for the wealthy who have plentiful assets to distribute to their family. This is simply not true.
A will is simply a document that provides for the distribution and administration of your assets upon your death. Without a will, the Singapore government effectively decides who should inherit your assets instead according to strict rules. Therefore, no matter how much or how little you have, it is essential to plan ahead to ensure that your assets and belongings are distributed according to your wishes.
A will should list the person(s), charities or organisation(s) – known as the ‘beneficiaries’ – to which you want to pass your assets after death. These assets can range from ‘hard’ assets, such as any real estate or bank accounts, to items of purely sentimental or practical value.
Your assets can be distributed generally to your beneficiaries in a specified proportion or certain items can be distributed to specific beneficiaries. If you have young or disabled children, you can also name a guardian who will be responsible for their care in your will.
You should also nominate a person – known as your ‘executor’ – who will be responsible for administering and ‘executing’ your will upon your death. This person is usually your main beneficiary or a close friend or relative.
Certain assets such as your Central Provident Fund (CPF) monies and insurance policies are governed by different rules. CPF monies are dealt with through the CPF Nomination Scheme. If no valid nomination is made, CPF assets will be distributed according to the Intestate Succession Act (non-Muslims) and the Administration of Muslim Law Act (Muslims).
Proceeds of insurance policies will be distributed according to the respective policy. Generally, if the policy provides that the proceeds will be distributed to your ‘estate’, the proceeds will be distributed according to your will. You should check your insurance policy or contact your insurance agent for further details.
If you die ‘intestate’ – without making a will – your assets will be distributed according to Singapore law. Different rules apply for Muslims or non-Muslims. All outstanding debts and claims (including funeral expenses) will be paid out of your assets before distribution to your lawful heirs. For Muslims, assets will be distributed according to Shari’ah laws. For non-Muslims, assets will be distributed according to the Intestate Succession Act.
As long as you are above 21 years of age and are of sound mind, you can prepare your own will without appointing a lawyer. It may however be worthwhile appointing a lawyer because certain procedural requirements need to be followed to ensure that your will is valid and enforceable.
You should also review your will regularly, especially when a significant life event occurs, such as a marriage, birth or adoption of a child, divorce or death of one of your beneficiaries. If you wish to amend your will, you can either prepare a fresh will that will supersede the previous one or prepare a supplemental will, also known as a ‘codicil’. You should never amend a will by simply adding or striking out sections in pen as this may invalidate it.
After you have prepared a will, it is important to inform your chosen executor and even your beneficiaries of your will and where it is kept. It should be kept securely or placed with your lawyer, if you have appointed one. For a small fee, you may also deposit information at the wills registry maintained by the Singapore government.
If a family business is involved, succession planning is critical to ensure the continued viability of the business. It is not just a question of ownership but also a question of leadership and management. Transitions take time, so succession planning should be a conversation that happens early and often between the owner and the intended successors. A well planned and executed strategy can prevent a gap in leadership or a power struggle, both of which could hurt the business.
A valid will and succession plan can address many potentially sensitive issues before they become personal. They can also help to alleviate the stress of dealing with a loss in the family. When there is a plan, you will know that your family will be taken care of and your assets will be distributed according to your wishes.