INTEGRATED Estate Planning is more that just Will Planning:

This cases as reported in the newspaper is a good case to illustrate my point:

In a newspaper report dated 1 March 2006 in a Chinese national daily, there was a case where the deceased mother and his wife were involved in a tussle over his estate.
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This young man, aged 26 was involved in a serious road accident in Kuala Lumpur on 30 September 2004 and was in coma for nine months before he died. He left behind his elderly parents and a brother who suffers from autistic illness. Before his death, he had already registered his marriage with a girl but they had not organized a traditional Chinese tea ceremony to celebrate their marriage.
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In the press conference, the deceased’s mother claimed that her daughter-in-law had already made withdrawal from SOCSO amounting to RM 9,672 and kept the money to herself.

When the deceased mother inquired about her son’s contributions in EPF, she was told by the officer that her daughter-in-law had made application for withdrawal and RM 5,000 had been paid out so far. Legal action was in progress trying to prevent her daughter-in-law from getting hold of the balance of RM 33,000.

The distraught mother told reporters that her son was the main bread winner in the family. He was a skilled technician with good income and contributed generously every month for the living expenses of his aging parents and disabled brother. His father, age 63 was only working part time as a daily paid laborer. Now that her son was gone, the family needs the deceased’s SOCSO payout and EPF money to finance the living expenses of the family.
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When the deceased was in coma in the hospital, the family had to sell the car for RM 24,000 to pay for the hefty hospital expenses.

The deceased mother said her relationship with her daughter-in-law was normal before his son’s mishap. But after her son was involved in the road accident and was in coma, it was she and her husband who took care of him and attended to all his need. She claimed that her daughter-in-law only made a few phone calls and paid a few visits. After that her daughter-in-law refused to meet her and only communicated through her father.
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Through her father, the daughter-in-law spelt out the condition attached if she were to hand the SOCSO and EPF money back to the deceased’s family. She wanted the terrace house in Serdang Jaya which the deceased has half share in the house, joint name with his mother.


Lesson learned

There are many things we can learn from such “kisah benar”. The reflections from these unfortunate cases can help everyone in doing a better job in their estate planning.

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Will Planning

Will planning is more than just writing a Will. The lesson learned from the above case, who should get the SOCSO and EPF monies are also questions to ask in Will planning.


Nomination in EPF / Insurance policies

Is it better to distribute the EPF money through nomination or is it better to distribute through the provisions in the Will?

If one owns life and personal accident insurance policies, then the same questions must be asked as well.


Joint ownership of house / immovable assets

Then the next issue is who should get the half undivided share of the terrace house?

The practical issues must also be addressed. If the half share of the house is willed to the wife and is now jointly owned with the mother, will this solve the problem or will this create more unnecessary problems?


Providing for the surviving widow

Providing adequately for the surviving wife is the responsibility of a husband, especially if the wife is a home maker and may not have income of her own.


Providing for minor children

If there are minor children, then it is even more important to make adequate provisions to insure their future.


Providing for aging parents

For the “sandwich generation” who not only have own nucleus family to take care, but also the aging parents who may be left behind, then care must be exercised in the estate planning to make sure that the welfare of the seniors are not neglected.


Providing for handicapped beneficiaries

The welfare of such beneficiaries should not be neglected as they would not be able to fend for themselves if they are not provided for.

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Conclusion

In my integrated estate planning model, the 3Ps objectives are providing for different classes of beneficiaries in the most appropriate manner; preserving the estate so that the maximum can be perpetuated and distributed in the most efficient manner.

In this case study, the priority is actually providing adequately for the different classes of beneficiaries and in the most appropriate manner so that there are no unnecessary disputes between them.


To learn more about estate planning, please read articles written & published by Lee Khee Chuan at: www.lkcestateplanning.com