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Borneo Post with the expert help of Rockwills Trustee Bhd, the leading specialist in estate planning having pioneered wills and trust 26 years ago, is publishing a regular Q&A column on estate planning. It will feature questions which readers have in mind but don’t know who to ask:

 

Question 1: Sir, I intend to transfer the ownership of my house to my wife and three children. If my wife dies, God forbid, before me, does it mean that my wife’s share will then go to my three children? So one quarter-share each becomes one-third share each for my three children? What happens to the will upon my passing? Who will initiate the transfer instruments with the Land and Survey Department so that the transfer of ownership of the house is executed into the house land-title?

 

Rockwills Answer: Thank you for writing to us. If you transfer the ownership of your house to your wife and children while you are alive, then your wife’s portion of the house will be treated as part of her estate if she passes away before you and her estate will be distributed depending on whether she has written a will or not.

If she has not written a will, then a quarter share of her portion of the house will be distributed to her surviving parent(s), a quarter of share to you and the balance of half will be shared equally among your three children. If you pass away later on, the quarter share of the portion of the house you inherit from your wife will be distributed to your parent(s) as to one-third share and the balance of two-thirds of your share will be distributed among your three children equally. Later on, the departure of parents on both sides might further complicate the ownership of the house.

If a person dies without a will, an administrator must be appointed amongst the heirs to initiate the court order and thereafter to effect the land title transfer procedure with the relevant land offices.

As you can see, the ownership of the house becomes very messy when there is no will.

On the other hand, you can do a will to make it clear that should your wife not survive you, the portion that would otherwise go to her would revert to your children in equal share. You can leave instructions as to who you wish to appoint as the executor to handle the necessary legal processes and transfer of title. And this will avoid the messiness highlighted above.

We suggest that you and your wife should write a will each to avoid heirship claims on your assets from parties outside your immediate family, and at the same time appointing a suitable person with experience to act as your executor to administer your estate. We strongly recommend that you seek a professional estate [lanner for advice on how you should word your wishes.

 

Question 2: Dear Rockwills, I am planning to do a trust in my will. However, before I do that, I would like to seek your recommendation on the instructions. I have two sons and the trust would be for their benefit only. The eldest is now 16 years old and the youngest is 12 years old. When I have passed away, I hope they can have RM5,000 a month until they are 30 years old, which I think they should be matured by then. Will this arrangement be good enough for both of them?

 

Rockwills Answer: Thank you for writing to us. Whilst trust is a simple concept, the trust instructions, however, require careful consideration.

If by RM5,000 a month you mean sharing, then you ought to think twice whether your two sons should be sharing the RM5,000 a month or should they have access to RM5,000 individually.

Secondly, whether the RM5,000 a month is enough not just for living expenses but also for education and medical expenses?

Should you set aside more provisions for other purposes, for example, their marriage, purchasing of motor vehicles and even incentives to motivate them to score good academic results?

Trust is a very versatile and useful estate planning tool when done properly. We suggest that you seek advice from a professional estate planner especially one with experience in setting up trusts.

 

This Q&A Column in published as a joint public service and educational initiative with Rockwills Trustee Bhd. Please email your questions related to estate planning to [email protected] or Rockwills’ training and business development assistant general manager Sam Chan ([email protected]).