When our loved one is on the blink of death, most of our attention will be focused on the healthcare aspect and ensuring they receive the best treatment possible. However, we tend to forgo the financial aspect and chose not to talk about it till our loved one is gone. To worsen the situation, when no will is done before their passing, this may lead to problems like the distribution of the deceased asset or even to withdrawing their money out.
In this article, I hope to share with you what you should do for your legacy planning to avoid such a situation. Additionally, I would explain to you the process to recover these assets should your loved ones not do any planning.
Legacy Planning
Legacy planning in layman's terms involves the distribution of your assets according to your wishes. This is important as it gives you the final say on how your assets will be distributed. With legacy planning, it would also prevent any unnecessary conflict between your children and also to facilitate the legal process.
Will
The first thing you should do is to write a will. There are 2 ways you can go about doing this. Making a will online or hiring a wills lawyer.
Online Will
- Consider using singaporelegaladvice's WillMaker to create your will in 20mins at the comforts of your home. This service will cost you $89 and in return, it will generate a will in Microsoft Word format for you to print and sign in the presence of 2 witnesses to make it legally valid.
- Alternatively, you can use MoneyOwl's will writing service which is currently free.
Hiring a lawyer
- Alternatively, if you require a more customized will, you can hire a lawyer to draft a will for you that tailors to your needs. This would generally set you back around $300 and above.
Once you have made your will, you need to decide where you want to store it. It should be somewhere accessible to your executor while also kept in a safe place to prevent wear and tear. Here are some places you can consider:
- Will Custody
- Deposit Boxes in Financial Institutions
- Wills Registry (Your actual will are not kept in the registry)
CPF nominations
Your CPF monies cannot be included in your will since it does not form part of your estate, as such, your next step is to make your CPF nomination. This nomination will cover all the monies in your CPF Accounts and any unused CPF Life premiums. However, it does not cover any properties bought using your CPF monies, any payout from the Dependants' Protection Scheme, and any monies in your CPFIS.
Here are the steps to make a nomination:
- Submit your CPF nomination form online via mycpf (Alternatively, you can head down to CPF service Centre and complete the nomination form there)
- Once your application has been processed, you will be notified by the CPF Board
- Constantly review your nomination to keep it up to date.
Note: If one of your nominees passes away before you, their share will be distributed to the rest of the surviving nominees in the same proportion as their specified shares.
Refer here for more information
Lasting Power of Attorney
The Lasting Power of Attorney is a legal document which allows you to appoint one or more person to make decisions on your behalf in the event you have lost your mental capacity. Unlike a will, it does not cover the distribution of a person's assets. Instead, LPA gives the donee the authority to make decisions on your behalf. This can be in terms of personal welfare like where you live and/or property and financial matters.
Here are the steps for you to apply for an LPA:
- Fill up the relevant form located here. (Form 1 is the standard version which can be done by yourself. If you require a more customized LPA, you should engage a lawyer to help you will filling up Form 2)
- Have the form certified by a practicing lawyer, psychiatrist, or an accredited doctor
- Mail your LPA application to the OPG within 6 months of signing it
Others
You may have some assets that are not covered by any of those legal documents. This may include your overseas stocks, airline miles or roboadvisor, etc. The last resort for these assets would be to entrust someone you trust with your account. They would then be able to liquidate your assets after your passing.
What if your loved ones did not do any of the things mentioned above?
Here are the assets that can be administered by the Public Trustee:
- Deceased's money in banks or other financial institutions in Singapore;
- Deceased’s shares which are listed on the Singapore Exchange;
- Deceased’s fully paid-up vehicles, apart from commercial vehicles like taxis (Only transferring of the vehicles);
- Salary the Deceased was owed but not yet paid;
- Deceased’s items in a safe-deposit box;
- Deceased’s money paid as government compensation; and
- Deceased’s money from the Workfare Income Supplement Scheme.
To get started, head over to Public Trustee Office E-Services and select 'Administration of Deceased Estate (Assets other than CPF / Baby Bonus / Edusave / PSEA Monies)'. From there, you will be required to fill in all the information regarding the deceased assets and many more. Some of the common documents required are:
- Death Certificate of Deceased
- Birth Certificate of Deceased
- Marriage Certificate of Deceased
- Divorce Certificate
- Birth Certificate of Beneficiary
- NRIC of Beneficiary
- Death Certificate of Beneficiary (if deceased)
- Marriage Certificate of Deceased’s Parents
- Death Certificate of Parent (if deceased)
- Frontpage of bank account passbook/bank statement
For estate value above S$50,000 (Grant of Probate/ Grant of Letter of Administration)
For estate value above S$50,000, there are 2 possible ways. If your loved one has written a (valid) will before their passing, you should apply for a Grant of Probate. However, if there isn't any will made, you need to apply for the Grant of Letter of Administration.
Worst come to worst, the asset will be distributed according to the Intestate Succession Act. However, the disadvantage is that the legal process is very slow and you will not get to decide how you want the asset to be distributed.
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| Source: singaporelegaladvice |
To get a better understanding of the distribution, you can look at this video here by SingaporeLegalAdvice.com
Grant of Letters of Administration
To begin the distribution process, the deceased next-of-kin* has to apply for a Grant of Letters of Administration. This is a legal document that authorizes the person the administer and distribute the deceased's asset* according to the Intestate Succession Act.
The administrator is required to pay off any liability the deceased has before distributing the remaining according to the Intestate Succession Act.
*According to ISA, there a 7 classes of persons who, in descending order of priority are entitled to apply to be the administrator. There are namely:
- Spouse
- Children
- Parents
- Siblings
- Nephews and nieces
- Grandparents
- Uncles and aunts
- Real estate (HDB/Private Property)
- Monies in bank account (including fixed deposit and unit trust accounts)
- Stocks (Including those in roboadvisors)
- Insurance policies (Except life insurance policies with nominations)
- Vehicle
- Jewelry
- Items in a safe deposit box
You can look at this toolkit provided by the Family Justice Courts if you want to do the application yourself. Else, you may engage a lawyer to assist you. In general, the fee for a simple non-contentious LOA range from S$2,500 to S$3,500.
To apply for a Grant of Letters of Administration here are the general steps you will take.
1.Preparation of documents
- Service Bureau Form for Application for Letters of Administration (download the 'Probate Application/Citation' form and fill up the 'Probate' tab)
- Schedule of Assets (Form 226)
- Death certificate of the deceased
- Death certificate of the next-of-kin (if applicable)
- Divorce certificate of the deceased (if applicable)
- Foreign grant (if applicable)
- Inheritance certificate (if applicable)
2.Once you have prepared all your documents, bring them to the LawNet & CrimsonLogic Service Bureau to search for existing caveats and probate applications on the deceased's estate.
3.Submit your application to the Service Bureau with all your documents above. It usually takes 1-3 weeks for the application to get approved and you will be notified then.
4. Prepare the Supporting Affidavit (Form 225) and Administration Oath (Form 54). This should be done within 14 days from the filing of your application.
5. Once the court issues the Grant of Letters of Administration, fill-up the Request to Extract Grant form (download the 'Probate Application/Citation' form and fill up the 'Extraction of Grant' tab), to extract the grant. Concurrently, you have to conduct one last caveat and probate application search. After extracting the grant, you will have the authority to manage the deceased's estate from there.
Click here to read more about Letter of Administration
Grant of Probate
If the deceased has left behind a valid will and the named executor is willing to administer the estate of the deceased, you should apply for a Grant of Probate instead. Likewise, you can consider seeking a lawyer to help you with this process.
To apply for a Grant of Probate here are the general steps you will take.
1.Preparation of documents
- Ex parte originating summons (Form 48 and Form 52)
- Statement for Probate of Administration (Form 51)
- Death Certificate
- Will
- Search report of both the record of caveats and record of private applications
Click here to read more about Grant of Probate
Summary
No one likes to plan for their death. However, by doing so, it would help your loved ones in the future.
There are still many things I did not cover, however, this is a good starting point for you. If you would like to find out more about legacy planning, you can check out singaporelegaladvice.com. They provide an in-depth explanation of different legal services that might be helpful to you.
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