LET'S TALK ABOUT ESTATE PLANNING PART I
I am going to start by asking you to answer a couple of questions; you may want to record your responses so bring your notebook/jotter nearby:
- How many have assets worth ₦50 million and above? Please list them.
- Review your list and for the men, exclude the cars. For the ladies please exclude the jewelry, designer bags and clothes.
- Are your assets after (2) above worth ₦50 million or above?
- Would you like to leave these assets of value which you have acquired to a loved one? E.g. spouse, children, aged parents, siblings etc.
- How many have a written WILL?
- How many have a TRUST?
- Why do you not have a written WILL or TRUST given your desire in (4) above?
- Tell us what plans or back-up arrangement you have put in place for your family to cope without you in the event of your incapacity? Death?
- Are your loved ones sufficiently briefed on the plans in (8) above?
What is Estate Planning?
The process of anticipating and arranging for the disposal of one’s assets.
What is the primary purpose of an estate plan?
Ø Taking care of your loved ones
Why plan your estate now?
Ø Because the sooner you start, the more certain you can be that your plan will take care of your family’s needs in the way that you want.
Ø Having an estate plan also provides a great deal of comfort. You will be able to plan for your family’s financial needs; and after death or incapacity, your loved ones will not have to fret about what you would have wanted them to do, they will know your actual wishes.
Types of Estate Planning tools include;
· LIFE INSURANCE
· MEDICAL INSURANCE
What happens if I do not plan my estate?
Ø The State Government will plan it for you. The State’s Laws of Intestate Succession will apply and the State will decide who inherits your assets, usually your spouse and children.
Ø If you have minor children, a court will have to decide who will care for them without the benefit of your input into that decision.
Ø The business you spent a lifetime building may end up failing or in the hands of a court appointed receiver.
What are the benefits of planning your Estate?
Ø The biggest advantage of planning your estate is that your wishes will be respected, both while you are alive and after your death.
Ø Your Will and TRUST ensure your assets are distributed to the heirs you choose under the terms and conditions you define.
Ø Incapacity planning helps ensure that you receive the type of medical care and treatment you want.
Ø Your business succession plan helps ensure that your business does not fail following your incapacity or death and that control of your business passes to a suitable successor
We will cover basic definitions of some terms in the next publication.
In the meantime, please give us feedback on this and subsequent articles. You may email us at firstname.lastname@example.org or pick up a brochure from Nana Dawodu.
Written by: Nana Dawodu.
Ø Estate & Trust Administration for Dummies by Margaret Atkins Munro & Kathryn A. Murphy
Ø Wills & Trusts Kit for dummies by Aaron Larson
Ø Suze Orman Will & Trust Kit