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Estate planning is not merely preparing a will, in fact, it requires some proper planning and arrangements to protect and preserve a person’s total assets for the benefit of his family and loved ones. The objectives behind estate planning are to protect one’s estate or assets from being claimed by creditors, avoid transfer of assets to wasteful and irresponsible beneficiaries, preserve the estate in its original value and providing rightful beneficiaries who are still lacking financial acumen with an appropriate financial back-up in the future.
We have gathered here an essential estate planning guide on what types of assets transfer is available to the public and several important aspects you should take note of in ensuring your proper estate planning is firmly in place. We believe you would want to make sure your assets are being transferred without a hitch to your loved ones according to your wishes after death. So spend a few minutes go through the below transferring procedures even though you might engage the services of estate planning attorneys or trustees. It would benefit you tremendously.
Statutory law transfer
- This type of transfer is validated through the operation of law. Common transfer cases that involve statutory law transfer are life insurance policy nominations and EPF nominations in which the nominations can be made revocable or non-revocable. For Muslims, the case is a little bit different in that the names which are nominated are not the beneficiaries but only nominees whose role is to distribute the EPF funds according to Al-Faraid Distribution laws.
- This type of transfer is viable through the signing of a contract or agreement during a person’s lifetime to ensure that your assets are transferred to your beneficiaries in a proper manner upon his death. Common example of contract transfer includes an absolute assignment of a person’s life insurance policies which is non-revocable. Trusts like Inter Vivos or Living Trusts are also examples of contract transfer where the owner passes legal title of trust property to a trustee to hold on for the beneficiary in accordance to the terms being set out in the trust. Both Muslims and non-Muslims could utilize this efficient tool for creditor protection.
- Also called a probate transfer, this transfer shall take effect if the other two types of transfer are not in force when someone dies and his/her properties have to be transferred nonetheless. Hence it is always a wise decision to write a will in case of some untoward circumstances.Be equipped with the basic knowledge of estate planning will help you manage your finance in a more effective way and it is always advisable to start as early as possible!