Sooner or later, you’ll have to think about the legacy that you want to leave behind. You want to put your affairs in order so that the people who depend on you can be taken care of even after you’re gone. At the same time, you definitely have a few ideas on how to distribute and use the wealth and property you’ve accumulated in your lifetime, and you want the people who will take over your estate to follow your instructions despite the fact that you’re no longer there to supervise the whole affair.

You have a wealth of options available to you so you can properly plan for how your estate in Singapore will be distributed when you’re gone. Estate planning now doesn’t mean that you can’t change your mind later on. In fact, it’s recommended that you update your plans every time you undergo status changes, such as when getting married or divorced, having children, starting a business, or acquiring property. This way, the people you’ll leave behind can have a good idea of how you want your property to be disposed of after you’re gone. 

Here are some of the most helpful tools you should use when estate planning in Singapore:

Will

What are you leaving behind once you’re gone? Do you have assets that you want to go to a particular family member or debts that need to be paid? Who will make sure that your instructions will be followed? These are some of the questions that need to be addressed in your will. 

To put it simply, a will refers to a written document detailing the instructions for how you want your estate to be distributed upon your death. It’s ideal for you to write a will, especially if you have dependents, such as young children, elderly parents, or family members with disabilities. There are a few criteria you should meet in order to write a legally binding will. You should be over 21 years old during the creation of the will, for one. Also, the writing must be witnessed by at least 2 people who are also of legal age, and these witnesses should affix their signature to the document. 

Trust

Alternatively, you can set up a trust, which is a legal arrangement between you and someone you trust to manage your estate once you’re gone. In this setup, the trustee takes ownership of the asset. This arrangement is ideal if you have instructions for the property once you’re gone, such as if you want an asset to be sold, invested, or donated, for example. A trust may also suit personal situations, like if you have a young child whom you want to have control over the property once they reach a certain age.

Central Provident Fund Nomination

Your CPF balance is not included in your estate, and its distribution will not depend on your will or trust. Instead, your CPF Nominations will dictate who will get your monies. Your nominees can receive your CPF balance in 3 forms, namely: the default Cash Nomination; Enhanced Nomination Scheme (ENS) Nomination, wherein the nominees will get their due in their CPF account; and Special Needs Savings Scheme (SNSS) Nomination, an option that allows nominees with special needs to get their CPF savings on a monthly basis. 

For your CPF Nomination Form to be valid, it must be signed with 2 witnesses present, and these witnesses must be older than 21. 

Life Insurance Policies

The life insurance policies you have under your name should also be considered when planning your estate. This policy is taken against the insured’s life for the benefit of their nominees. Life insurance policies are similar to trusts in the sense that they are not part of the deceased’s estate. If you leave the nominations blank, however, some providers allow the benefits to be distributed according to the will of the policy owner. 

Lasting Power of Attorney

Losing one’s mental capacity due to illness or injury is a tragedy, but it’s also something that you can plan for. If you’re at high risk of suffering from progressive neurological conditions like dementia, for example, you can prepare a document called Lasting Power of Attorney. This document authorises someone you trust to make decisions on your behalf should you lose mental capacity.

What are the consequences of failing to plan your estate?

Passing away without planning your estate leaves your loved ones in the dark about your assets and the level of support that they can get. At the same time, it places an additional burden on the people that you leave behind. For one, your family does not know about the full extent of your assets and responsibilities, so they have to do a full inventory before they can set your affairs in order. At the same time, your assets may be forcibly liquefied so that the estate can be distributed among your family members. And if your family members consigned a loan with you, then they’ll end up assuming this responsibility and paying for it on their own. Then there’s also the concern of organising the funeral.    

There’s no need for your loved ones to deal with these issues on top of grieving your loss. By taking care of your estate beforehand and updating your documents whenever needed, you’re one step closer to ensuring that the ones you leave behind will be able to focus on their grief, healing, and recovery.