Let's say you have created a legacy of assets during your lifetime and want your family to inherit these assets smoothly. With this objective, following legal advice, you prepare your Will, and name your family members as nominees in the asset classes. You would be wise to assume that the succession process will be easier after your death. However, this may not be the case – despite your foresight, some common pitfalls may hinder the seamless succession of your assets. Here are three key practical aspects to consider to reduce the risk of hardship.
storage of desire
Once you have drawn up the will, you must notify the executors named in the will of its existence and storage location. The place of storage should be such that access to the will (including amendments) after your death is not burdensome. Failing this, the executor and family members may not be able to retrieve the will, or they may mistakenly believe there is no will or they may rely on an older will, unaware of it. It has since been removed.
While a bank locker or personal vault can be a safe place to keep a will, a common mistake is not to direct the executors to find the key or passcode. If the Will is kept in the safe custody of a lawyer, clear written instructions should be given to the lawyer and the executor as to the delivery of the will on death. If a Will is executed in duplicate, the copies of which are kept at different places, it would be prudent to inform the executors to retrieve all such copies in order to avoid confusion or misuse.
You can also leave the will to a trusted executor, but make sure you can easily access your will if they predecease you.
information on assets and liabilities
One of the most important problems faced by executors and heirs while giving effect to a Will is the uncertainty regarding the entire assets and liabilities of the testator. Since there is no official countrywide property register, it is difficult for executors to ascertain the full extent of ownership of property, especially when maintained at different locations/accounts. This difficulty is most commonly encountered in the case of immovable property, in particular, when the land records are not updated- for example, when a property is inherited but the formalities have not been completed. Complications also arise when shares and mutual fund units are held in physical form as physical certificates are capable of getting lost.
Drafting a Will that describes all assets and liabilities as on the date of the Will can solve this issue to an extent. For subsequent assets and liabilities, either the Will must be continually updated by preparing an amendment (called a Codicil) or the property register/balance sheet must be preserved by you or your accountant or wealth advisor. The statement of liabilities should include details of loans taken or given as well as periodic repayments. Similarly, two physical files – for originals and copies – containing the supporting documents should be maintained. These registers and files can either be kept along with the Will, or covered under a note/letter to the family members with the details.
password register
Like most individuals in this digital age, you may hold assets in digital form such as personal records such as digital photos, content on social media websites, as well as memberships, domain names, tokens and cryptocurrency. These can be valuable to you financially as well as emotionally. Although called 'estate', not all of these can be considered as 'estate' coming under your will. Some may only be licenses to use certain websites or services that will expire upon your death.
There is no law governing digital assets in India and there is currently no unified approach to their 'inheritance' or access by heirs. Service providers have their own policy in dealing with digital assets in case of death of the account holder. You should check the policies of the relevant websites and services on which basis you can leave written wishes for your family about how you would like your digital content to be accessed and treated after your demise.
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