Right of Inheritance – Who will decide?
People work hard to earn money to meet their needs and create wealth. Life will be easier and more stress free because wealth gives people a sense of security. Wealth is important not because of wealth per se, but because of the purpose for which such wealth is accumulated.
Generally, the purpose of wealth is to provide the financial security to the dependent family members, funding the child’s education and marriage, to get regular income during old age, bequeathing the estate to loved ones and so on. These purposes can be realized only when one has an appropriate plan to pass on the benefits of one’s estate to intended persons. A person can document his intentions to leave behind his estate to specific persons and for specific purpose by making a WILL or creating a family trust. When a person has a proper plan to bequeath his estate, it is known as ‘Testament’.
If a person dies intestate i.e without any testament, all his estate will be inherited as per the applicable succession laws. The succession laws that operate in India are Hindu Succession Act, Indian Succession Act and Muslim Personal Law. Hindu Succession Act applies to Hindus, Jains and Buddhists where as Indian Succession Act applies to Christians, Jews and Parsis. Muslim Personal Law applies to Muslims.
These succession laws define the legal heirs of the deceased and the entitlement of such legal heirs in inheriting the property. In such case, when a person dies intestate, his wealth may not be inherited by a person for whose benefit such wealth is created. The precious wealth may be inherited by persons who are not in need or by persons who are likely to misuse such inheritance.
So, Estate Planning, i.e having a testamentary document, facilitates proper bequeathment of assets to intended beneficiaries where as in the event of intestate it is the law that decides the entitlement of persons who inherit the property. Generally, the perception of the investors is that nomination facilitates the transfer of assets to intended beneficiaries. But, a nominee is only a custodian and not the owner of your assets, and is legally bound to transfer the assets to the legal heirs.
Now, the choice is yours. Whether you take control over the inheritance of your estate or allow the law to decide. Your procrastination may result into complexities and also disputes among the legal heirs in inheriting your valuable assets. Sometimes it’s the smallest decisions that can change the life of someone forever.