Why do we need to do estate planning in Singapore?

Many people avoid thinking about death and the matters that surround death. Avoidance is not solving the problem, however. Instead, having an estate plan can provide a better peace of mind. Without planning, it can be disastrous for your loved ones when you are gone. Although we have the Intestate Succession Act in Singapore, the default distribution may not be ideal for your circumstances.

Having an estate plan in Singapore offers several important benefits, both for you during your lifetime and for your loved ones after your passing.

Here are some of the key advantages of having an estate plan:

#1 Control over Assets Distribution

You have better control over how your assets are distributed after your passing. This allows you to ensure that your assets go to the individuals, charities, or organisations you choose.

#2 Providing & Protecting Minor Children:

If you have minor children (children below age 21), your can appoint guardians to care for them. You can also set up Trusts and appoint a Trustee to provide for their financial needs.

#3 Faster Distribution of Estate

Without a valid estate plan, your assets will be distributed according to Singapore’s intestacy laws. This means that the next-of-kin will also need to apply for the Letter of Administration to execute the distribution of your estate. This can take a long time. If your loved ones are in need of immediate cash liquidity, this additional time delay can worsen their situation.

#4 Achieve Tax Efficiency:

Proper estate planning can help with minimising taxes and/or debt cancellation, ensuring that more of your assets are passed on to your beneficiaries.

#5 Mental Incapacity Planning:

Estate planning also includes setting up documents such as a Lasting Power of Attorney, Advanced Care Plan and Advance Medical Directive, which ensure that your financial and healthcare decisions are managed if you become mentally incapacitated and unable to manage your own affairs.

#6 Peace of Mind:

Knowing that you have a comprehensive estate plan in place provides peace of mind, both for you and your loved ones, as it ensures that your wishes are protected.

These are general benefits to having an estate plan. If you want to ensure that your estate plan aligns with your specific goals and circumstance, consider seeking professional advice for a more personalised guidance.