Introduction

As Singapore’s population continues to age, the significance of legacy planning and will preparation has never been more crucial. An increasing number of individuals are taking a proactive approach, enrolling in courses and educating themselves about the complexities involved in legacy planning and will-drafting. However, this intricate process is rife with potential pitfalls and blind spots that many inexperienced individuals may fail to note. In this month’s newsletter on family legacy planning, we explore seven of the most common blind spots relating to wills, hopefully, giving greater insights to those looking to have their own wills done up.

1. Including CPF Monies in Your Will

The Central Provident Fund (CPF) system operates under a distinct nomination mechanism for the designation of beneficiaries. The government has expressly stated that the monies in the CPF cannot form part of an individual’s estate and have to be managed separately through prescribed directions from the CPF Board.

To mitigate confusion and avoid delays in the distribution of your CPF savings, it is imperative to keep your CPF nominations up to date. Regularly reviewing and updating these nominations ensures that your desired allocation of these funds is accurately reflected and that your beneficiaries receive their entitlements without undue complications. Your CPF monies and assets cannot be included in your wills.

2. Misunderstanding about Joint Tenancy

Real estate held under a joint tenancy arrangement, which includes the right of survivorship, is automatically transferred to the surviving joint tenant upon your demise. Consequently, such properties need not be included in your will. This automatic transfer process ensures that the surviving joint tenant retains full ownership of the property without the need for probate.

However, if your preference is an alternative distribution of the property upon your passing, it is essential to restructure the ownership to tenants-in-common (which involves a process known as “severance”). This form of ownership allows you to specify your share of the property in your will, providing you with the opportunity to state how you wish to distribute your share in the property to your beneficiaries if that should be your desire.

3. Improper Selection of Witnesses: A Catalyst for Legal Disputes

The validity of your will hinges significantly on the proper selection of witnesses. Common missteps in this area can lead to the invalidation of the will or future legal challenges. To safeguard against such issues, it is crucial to adhere to the following guidelines:

Beneficiaries (and their respective spouses) cannot be Witnesses: Any of the aforementioned parties, along with their spouses, is disqualified from serving as a witness. Their involvement could lead to claims of undue influence or conflict of interest, ultimately jeopardizing the validity of your will.

Ineligible Individuals: Witnesses must be of sound mind and must understand fully the significance of the will and its implications. Those who are mentally incapacitated are not legally competent to serve as witnesses.

You should opt for independent and impartial witnesses who can credibly attest to your mental capacity and who have a clear understanding of the will’s contents at the time of its execution. This measure reinforces the integrity of your will and minimizes the risk of future disputes.

4. Omission of a Comprehensive Asset Inventory: Complications for Executors

Having a Will without an Asset Inventory is akin to telling someone that there is treasure without handing them the treasure map. Indeed, a well-drafted will should be complemented by a detailed, up-to-date inventory of your assets. This comprehensive list should encompass bank accounts, investments, real estate (excluding joint tenancies), and valuable personal property. By providing a clear and complete picture of your assets, you facilitate the executor’s task, ensuring efficient administration of your estate.

An asset inventory not only aids the executor in locating and valuing your assets but also helps prevent potential oversights or disputes among beneficiaries. Regularly updating this list to reflect any changes in your financial or property holdings ensures that your estate plan remains current and accurate. A transparent and thorough asset list is a critical component of effective estate administration, reducing the burden on your executor and ensuring your wishes are fulfilled.

5. Failure to Inform Executors and Guardians: A Preventable Oversight

Once you have designated your executor (the individual responsible for implementing the provisions of your will) and any guardians (for minor children, if applicable), it is crucial to notify them of their roles. Engaging in comprehensive discussions about your intentions, addressing any queries they might have, and confirming their willingness to undertake these pivotal roles is essential.

Failing to inform your executor and guardians can lead to confusion and delays in the execution of your will. It is advisable to provide them with copies of your will and any relevant documents, as well as to discuss your expectations and any specific instructions. This proactive communication ensures that they are prepared to fulfill their responsibilities and act in accordance with your wishes, thereby safeguarding the smooth administration of your estate.

6. Absence of a Residuary Estate Clause: Risking Intestate Succession

A residuary clause in your will specifies the distribution of any remaining assets after the fulfilment of specific bequests. Without such a clause, unallocated assets are subject to intestacy laws, potentially resulting in unintended beneficiaries. Intestacy laws vary and may distribute your assets in a manner that does not align with your wishes, often prioritizing close family members regardless of your personal relationships or intentions.

Including a clear and comprehensive residuary clause ensures that any residual assets are distributed according to your preferences. This clause acts as a safety net, capturing assets that may have been inadvertently omitted from the specific bequests, and providing clear instructions for their distribution. By incorporating a residuary clause, you secure the intended allocation of your entire estate, minimizing the risk of unintended beneficiaries and legal disputes.

7. Neglecting to Update Your Will Post-Marriage: Legal and Personal Ramifications

Marriage automatically nullifies any prior wills you have made, as per the legal provisions in many jurisdictions. It is imperative to revisit and revise your will subsequent to marriage, ensuring it accurately reflects your new marital status and any associated changes to your bequests. This step is essential to uphold your current wishes and the inclusion of your spouse.

Failure to update your will after marriage can result in unintended consequences, such as the distribution of your estate under intestacy laws or the exclusion of your spouse from receiving the assets you intended for them. By promptly revising your will, you ensure that it aligns with your current circumstances and legal obligations, thereby safeguarding the interests of your spouse and other beneficiaries.

Our Concluding Thoughts

While self-education through online resources and courses can be beneficial, the intricacies of estate planning are rife with blind spots and pitfalls which will prove to be fatal to the untrained and inexperienced drafter. Hence, this process necessitates professional expertise. Engaging a qualified legal professional specializing in wills and estate planning is crucial to guarantee that your will is legally sound, comprehensive, and precisely tailored to your individual circumstances.

A professional can provide invaluable guidance on complex legal issues, which also include trust arrangements and the interpretation of legal language. They can also help you navigate potential pitfalls and ensure compliance with all relevant laws and regulations. By seeking professional assistance, you enhance the robustness and enforceability of your will, providing peace of mind that your legacy will be preserved according to your wishes.

What Can SMTP Do to Help?

Tapping on our wealth of experience and our very own Wealth Legacy Screening process, our lawyers from the Legacy Planning Department will be able to assist you in a very systematic and detailed manner on your Family Legacy Planning journey.

We also believe in close engagement with our clients, paying close attention to their individual facts and circumstances, and tailoring our advice and courses of action to cater to their specific needs and requirements. SMTP’s core philosophy is to provide bespoke legal advice based on our private clients’ specific needs and requirements, as cases always differ on their fine details. Our team of dedicated staff are ever eager and prepared to assist interested parties. Should you or your clients require any assistance in legacy planning or trust matters, please feel free to contact our Business Development Team to schedule a consultation. We look forward to working with you.