| Estate planning addresses lifetime needs like | | | | - Financial security for dependents |
| permanent mental or physical disability and post-death | | | | - Long term care (Eldershield) and Disability Income |
| arrangements. | | | | Insurance in the event of mental or physical disability |
| The objectives are unique to the individual but generally | | | | (4) Powers Of Attorney |
| include: | | | | To authorize another party to act on behalf of the |
| - Distribution of property in accordance to one's wishes | | | | donor. |
| - Sufficient liquidity to pay off debts | | | | - For property: So that the property may still be sold if |
| - Appointment of executors | | | | necessary to raise funds in the event of mental or |
| - Security for dependents | | | | physical incapacity |
| - Contingencies | | | | - For healthcare: An enduring power of attorney allows |
| The 4 step process: | | | | another to make decisions in relation to medical issues |
| (1) Determine goals | | | | (5) Advance Medical Directives |
| (2) Preparation of plan | | | | It is a legal document signed by a person in advance |
| (3) Implementation of plan | | | | of his suffering a terminal illness that he would not wish |
| (4) Reviewing of plan | | | | to be subjected to extraordinary life-sustaining |
| Determine Goals | | | | treatment. |
| A lot depends on one's attitude towards security, | | | | (6) Charity |
| philanthropy, risk, work and money. Important areas to | | | | Leave a legacy by giving directly or creating a trust for |
| consider are: | | | | relief of poverty, education, religion or community |
| - Any known problems with a particular property (Do | | | | benefit. |
| not leave the burden behind) | | | | Implementation Of Plan |
| - Unresolved family issues (Relationship problems, | | | | It is recommended and in some case necessary to |
| children from other relationships, etc) | | | | engage professionals to implement the plan. |
| - Financial security for dependents | | | | - Lawyer: To advise on the legal issues, validity and |
| - Views towards chartiy | | | | enforcement of the arrangement. |
| - Attitude about extraordinary life sustaining medical | | | | - Insurance Specialist: The available types of insurance |
| treatment | | | | to best suit the needs and advise on the claiming |
| - Contingencies in the event of mental or physical | | | | process. |
| incapacity | | | | - Trust Service: To act as a trustee or executor. |
| Preparation Of Plan | | | | - Accountant: To provide tax advice and information |
| The following tools are used for the plan. | | | | with regard to assets in the estate. |
| (1) Wills | | | | Reviewing Of Plan |
| A Will has to be in writing and signed together with | | | | The plan will need to be reviewed with changes in |
| two disinterested witnesses. | | | | personal and financial circumstances as well as |
| Important provisions in the Will: | | | | changes in the the law affecting estate matters. An |
| - Appointment of Executor | | | | outdated plan may no longer be valid. |
| - Maintenance for Spouse or Child | | | | Other Areas To Note |
| - Avoid uncertainty (eg, wording of "equal distribution to | | | | (1) Use of joint ownership with survivorship |
| ALL grandchildren", the eventual number of | | | | Jointly held property will be passed on to the surviving |
| grandchildren cannot be determined conclusively) | | | | owner. It will not need to wait for the probate process |
| Failure to provide the above will may result in the Will | | | | and will not incur administrative transfer cost. Examples |
| being invalid or contested. | | | | are joint bank accounts and joint ownership in real |
| Other areas to note: | | | | property. |
| - Where should the Will be kept | | | | (2) Domicile |
| - Ensure the Will is most current by clearly dating the | | | | The place an individual considers his permanent |
| Will and destroying earlier originals | | | | residence. That country's law will determine if the Will is |
| - Designation of Guardians | | | | valid, the tax laws and where to file the probate. |
| - Residuary estate acquired in the future | | | | Owning properties in other countries may be subjected |
| - Tax apportionment as to which beneficiaries' assets | | | | to the laws there. |
| to bear the burden of outstanding debt | | | | (3) The Interstate Succession Act |
| - Contingent Beneficiaries and Executors | | | | Passing on without a valid Will will result in the estate |
| (2) Trusts | | | | being distributed in accordance with this Act. The |
| It is created by a trustee having the legal ownership to | | | | process takes longer as the letter of administration |
| manage a property for the benefit of someone else. | | | | needs to be applied, Administration Bond filed, sureties |
| Advantages: | | | | appointed, Renunciation and Consent Form may need |
| - Protection from creditors | | | | to be completed, etc. This is a lack of Estate Planning |
| - Privacy | | | | and it is not the recommended approach. |
| - Bypass the Probate process | | | | Reasons cited for failing to plan include: |
| - Professional management of institutional trustee | | | | - The subject of death is difficult to deal with |
| Disadvantages: | | | | - Other priorities in life such as career |
| - Irrevocable | | | | - Unconcerned what happens to their estate after |
| - Professional trustee fees | | | | death |
| (3) Insurance | | | | Overcome the obstacles and ensure estate planning |
| - Creation of Statutory Trust through Section 73 of the | | | | objectives are met. Do not leave an unnecessary |
| Conveyancing and Law of Property Act | | | | burden. |
| - Provision of liquidity | | | | |