Most of us know we need to write a will, even if we only hold a bank account, as the authorities need to know where our assets should go in the event of our death. But there’s more to consider than that. Most countries have a system called probate, whereby the courts administer our assets after we’ve died.
Here are five things you need to know to start planning for the distribution of your assets after your death.
1 Pick an executor
The executor of your estate should be someone who can handle bureaucracy and is not likely to have a meltdown at the thought of dealing with paperwork. He/ she will represent you in the Court of Probate or appoint a probate lawyer to do so. But probate can cost a lot of money, so you need to have all the important documents prepared. For example, the Schedule of Assets and Liabilities – what you own and what you owe. The more information you leave behind, the less it will cost your executor to find and distribute your assets. You must have a contingent executor in case your first choice fails. For many, their executor is their spouse. But if you both die together, who would you want to administer your estate? If you choose a parent, then you must name a third contingent executor.
2 Consider your beneficiaries
In Hong Kong (and many common law countries), residents enjoy testamentary freedom, meaning you can leave your assets to whomever you like. However, in some cases, for instance if you bequeath a charity and leave your family destitute, the courts may override your choice of beneficiary, if the will is contested. Note that certain countries have forced heirship whereby you must leave your assets to your children and spouse.
3 Name a guardian
If you have minor children, you can name a guardian in your will but as it can take months to have your will read, you should also prepare a Deed of Guardianship that allows you to make a separate nomination and expedite the process. If your permanent guardian lives overseas then you will also need to appoint a temporary, local guardian to care for your children until your permanent guardian can get to Hong Kong.
4 Share your passwords
You need a separate document to authorise your executor to handle your digital assets and the closure of your social-media accounts. Bitcoin, Facebook, Google, LinkedIn, Amazon, Twitter and Instagram… how do all your accounts get accessed and closed?
5 Write a Letter of Wishes
It is not necessary to name assets in your will but, if you do have personal effects – jewellery, musical instruments, artwork – that you would like to leave to certain people, write a Letter of Wishes. This allows your executor to locate these items and distribute them accordingly. If you write them in your will, there could be hold-ups.
• Carey, Suen Will Services, www.careysuen.com
You can email Annette M. Houlihan at [email protected] for a free consultation.
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