You will be able to explain how an estate is distributed without a will and why marriage matters.
Hui Min and Daniel married last month. Daniel made a will three years ago, when he bought a policy and the adviser suggested it, and it leaves everything to his parents. He assumes the will still stands and that he can update it whenever he gets round to it. Hui Min has never made one. She is 30, healthy and assumes that if anything happened, everything would go to Daniel anyway.
Both of them are wrong, in ways that are common and easy to fix. This module covers the documents a family needs if one partner dies or can no longer decide for themselves. It starts with the question most couples never ask until it matters: what happens to your money if you die without a will?
If a non-Muslim in Singapore dies without a valid will, their estate is distributed under the Intestate Succession Act. The Act sets out who inherits and in what shares, based on which relatives survive you: a spouse, children, parents, siblings and so on, in a fixed order.
The Act does not ask what you wanted. It follows the list. A spouse and children share the estate in fixed proportions. If there are no children, the spouse shares with the deceased person's parents. Lesson 8.1 of The Singapore personal finance system, What a will covers, and what it does not, gives an example.
Some people get nothing under the Act at all. An unmarried partner, however long you have been together, is not on the list. Nor is a stepchild you never adopted, a close friend or a charity. If you want any of them to receive something, a will is the only way.
There is also the delay. Without a will, a family member has to apply to court to be appointed administrator before they can deal with the estate, and that takes time and paperwork, at a moment when the family may be short of money.
For Muslims in Singapore, estates are distributed under the Administration of Muslim Law Act, according to Islamic inheritance rules known as faraid. The shares each heir receives are fixed by those rules, and a Muslim can only direct part of their estate by a will. The Syariah Court issues a certificate setting out who inherits and in what shares.
The rules differ from those for non-Muslims in many respects, including who counts as an heir. If they apply to you, get advice from someone who handles Muslim estates, and check the Syariah Court's guidance, before relying on anything in this lesson.
This is the part that catches Daniel. Under the Wills Act, which governs wills for non-Muslims, marriage generally revokes a will made before it. There is an exception for a will that was made in contemplation of that particular marriage, but most wills made years earlier do not qualify.
So Daniel's will, leaving everything to his parents, has most likely been cancelled by his wedding. If he died tomorrow, his estate would be shared under the Intestate Succession Act between Hui Min and his parents, because they have no children yet. That might be close to what he wants, or it might not. The point is that he has not chosen it.
The practical rule is simple. After you marry, make a new will, even if you made one before. Check with a lawyer whether your old one survives, but do not rely on it.
A will gives you control over four things that the law otherwise decides for you.
It lets you choose who receives what. You can leave specific things to specific people, a share of everything to others, or set conditions such as holding money for a child until a certain age.
It lets you choose who carries it out. The executor is the person you name in your will to collect your assets, pay your debts and distribute what is left. Pick someone organised and trustworthy, and ask them first. Many people name their spouse, with a second person as a backup.
It lets you choose who looks after your young children if both parents die. Lesson 7.3, Choose who looks after your children and who decides for you, covers this.
And it lets you include people the Act would leave out.
A will does not cover everything you own. CPF savings and insurance policies with nominations pass outside it, which lesson 7.2 explains, and jointly held property usually passes to the surviving owner. For what the will does cover, it is the difference between your wishes and a fixed list.
Before you think about a lawyer or wording, think about the people. Who would you want to receive what you own, and who would you trust to carry it out?
Write down who you would want to receive your assets and who you would trust to carry out your will.
Junxiong-WFG Organisation is an authorised representative of AIA Financial Advisers Private Limited (Reg. No. 201715016G).