Beyond Your Last Words: The Crucial Role of a Legal Will

In this article, we’ll explore the vital importance of having a legally sound will in India. Discover how this often-overlooked document can provide not only financial security but also invaluable peace of mind for you and your loved ones.

The Context

A will can save one’s family from being put into a quagmired pit of a legal conundrum, in case of death (which may even beuntimely) — Henrietta Newton Martin

Based on an investor’s age and the objectives they are attempting to attain, their lifespan goes through four extremely odd phases.

These stages are accumulation, consolidation (which lowers risk), spending (post-retirement), and lastly the succession of what’s left after spending.

Numerous conscientious investors make hundreds of deliberate judgments on the first three phases, but the final phase, known as “succession,” is frequently disregarded. Similar to stock markets, human life is very erratic and rarely takes a straight line.

These phases must regularly converge and overlap due to all the possibilities and permutations. For instance, the spending phase may begin while the accumulation phase is still in progress. This might occur in the event of unlucky events like medical emergencies that call for the immediate liquidation of assets.

A similar and very tragic phase occurred in India during the 2nd wave of COVID-19.

We can never forget the month of April 2021 when the second wave peaked and the whole nation gasped for Oxygen. Many sole breadwinners succumbed within a short span of contracting the deadly virus.

India went through a similar, depressing phase during COVID-19’s second wave. In April 2021, at the height of the second wave, when the nation was on life support, many sole breadwinners perished from the terrible sickness.

During the panic and mayhem, many families experienced emotional shattering. For these families, the issue was far from solved because they had yet to experience the consequences. Without a “legal Will” and a strategy for the people left behind, the future of heirs and dependents became uncertain.

Few of these brothers and sisters who lost their fight with mortality left a written “Will and a Testament” that guided their loved ones, but many families weren’t entirely sure what to do next. It is hence to be noted that every cent spent on investments has a specific goal.

Our experience highlights the need to have a “Written Will” to make sure that all individual efforts are aligned with that goal even after the originator has passed away.

The challenge

India is a hyper-optimistic country where talking about death is frowned upon. People do not bother to create a will and value life as a permanent or unending force.

The pervasive brainwashing of our citizenry, which categorizes a “Legal Will” as a tool primarily for the wealthy and powerful, poses a second difficulty that affects this subject. This write-up is made possible by the two constant truths that life is finite and that everybody must have a legal will.

The consequences

According to “The Hindu,” a prestigious Indian newspaper, as of December 2020, there were approximately ₹150 thousand crores in unclaimed deposits and balances in various Indian banks and insurance companies. When compared to roughly ₹130 thousand crores two years earlier, this was huge growth.

If the client doesn’t conduct any transactions through that account for at least ten years, the deposit is considered “unclaimed.”

Public banks and insurance companies hold the majority of this unclaimed money. The State Bank of India has the highest percentage of unclaimed deposits among all banks at 15%.

A 1.5-fold increase has also occurred in the quantity of unclaimed life insurance over time.

Life Insurance Corporation of India holds 82% of all unclaimed insurance amounts as of December 2020. In 2018, only 69% of these unclaimed sums were held by the LIC. With ₹119 thousand crores, over 80% of the entire amount of unclaimed money held by all insurance firms was held by the LIC of India.

Please be aware that we are not even bringing up the unclaimed property at this time. After the original owner passes away, unclaimed real estate could further contribute to the billions of rupees in unclaimed assets that are already simmering in family disputes.

If the insured party or deposit holder had been able to draft a legal will with the necessary disclosures and declarations bearing succession in mind, this unclaimed money would have assisted many families through their difficult times.

It should be remembered that in the event of the sudden death of a major breadwinner, all possessions, no matter how large or tiny, carry equal importance for vulnerable dependents.

What Is A Legal Will?

To begin with, a will is a valid legal document that states a person’s intentions on how their property or collected assets will be dispersed after their death and who will be in charge of such accumulations up until their final distribution.

A Will hence arranges how your possessions will be distributed after your passing and has the power to name guardians for small children. If you are married, have children, have aging parents, or own any transferable property, you should have a will.

The three conditions listed below should be met for a will to be considered genuine:

☑ Condition 1: You must be at least 18 years old and of sound mind.

☑ Condition 2: The individual making the declaration (Testator) should sign the document in writing.

☑ Condition 3: Each will need to be notarized (to avoid legal implications)

Types Of Legal Will

Privileged wills and Unprivileged wills are the two forms of wills recognized by the Indian Succession Act of 1925.

Privileged Will —

This is a unique form of will, made by a soldier participating in an expedition or actual combat, an airman similarly engaged, or a mariner at sea.

People in such positions are exempt from such legal restrictions and allowed to create simpler wills.

This is because it is unreasonable to expect them to have the time or resources to fulfill all the formalities needed for the validation of the will.

Execution of Privileged Will:

1. Written or verbal privileged wills are both acceptable.

2. Privilege wills must be carried out by a set of guidelines.

3. The testator should completely hand-write the wills. It doesn’t have to be signed or witnessed in this situation.

4. It can be entirely or partially written by another person, with the testator’s signature on it. It is not necessary to attest to this situation.

5. If it can be proven that the alleged will was prepared under the testator’s instructions or that he recognized it as his, even if it was largely or wholly drafted by someone else without the testator’s signature, the document will be considered the testator’s will.

6. If it is clear from the face of the document that it was not executed in the way the testator intended.

The instrument shall not, because of that circumstance, may be invalid, provided that his non-execution of it can reasonably ascribe to some cause other than the abandonment of the testamentary intentions expressed in the instrument.

Unprivileged Wills —

Unprivileged Will refers to all other types of wills that are not privileged.

These are the wills that must meet a specified set of criteria to be deemed valid.

These are the typical wills that the general public makes.

Execution of the Unprivileged Will:

1. The testator must sign or seal the will, or have someone else sign it for him while he is present.

2. The testator’s or the representative’s signature or mark must be positioned so that it appears as though the document was meant to serve as a will.

3. The will must have at least two witnesses attest to it.

Each of the two witnesses the testator’s signature, the testator’s mark on the “will”, or witnesses the signatures of others.

4. Each of the witnesses must sign the will in the presence of the testator, either at his or her direction or after receiving a personal acknowledgment of the testator’s signature, mark, or the signature of the other person.

Note: The presence of more than one witness concurrently shall not be required.

A will may not need to be registered. Although it gives the law some comfort, it has no direct impact on wills.

It is advisable to notarize or register the wills with the registrar, who then takes on the role of the wills’ legal guardian.

This creates a document that provides persuasive proof in court that the wills are genuine.

Understanding The Nuggets

After the writer’s debts have been paid off, the writer’s will specifies exactly how and to whom his or her assets will be dispersed. Testators are individuals who create formal wills.

The work of deciphering the goal and intentions of a testator can frequently become challenging because a will is a document that was made by a living person but is carried out after that person has passed away.

The assets, relationships, and other factors frequently change between the time someone forms a will and when they pass away, adding to the complexity. As a result, the will must always hold the test of time.

Even though a person can easily make a will while at home if the will is challenged after the testator’s death or in other circumstances where it is contentious, it may be exceedingly challenging to prove in court.

This is because even a simple-looking Will may have hidden complexities. Legal precedents and pending cases indicate that will contests can be a trying experience for the heirs that can last for decades because it is frequently impossible for family members to agree.

Egos and the authoritarian attitudes of the competing parties usually become a key reason for this dilemma.

Therefore, it is advised to consider these uncomfortable situations before approaching the table with a pen and paper.

How To Make A Legal Will?

🖱 Step1 – List All Assets & Liabilities

Creating a list of all of one’s assets and liabilities and classifying them into the following categories is a crucial step before discussing the specific format of a will.

(a) Moveable assets, such as money, stocks, and other items, that will continue to move until a person’s death

(b) Immovable assets, which are less likely to alter, such as real estate, land, and flats

(c) The last bucket contains jewelry, keepsakes from the family, and artwork that is special to the family.

The value of an asset must always be deducted from its liabilities.

It’s crucial to keep in mind that the person’s liabilities would be subtracted from their overall assets, so somewhat lowering them.

So while dividing up property in the will, the testator should keep this in mind.

🖱 Step 2 – Add Heirs as Joint Holders/Nominees

For moveable property, it might be a good idea to add the heir as a joint account holder or nominee so that the asset transfer after your death goes more smoothly.

It would be advisable to leave specified immovable properties to a single person as opposed to leaving them to two or more people jointly to avoid disagreements among heirs regarding their management.

If it is not possible to allocate specific properties to specific heirs, the distribution of the assets among the heirs may be specified in the Will as a value percentage.

For example, one way would be to state in the Will that one party can buy out the other heir at market value or a pre-fixed price.

It must be noted that a nomination for a house/flat with a housing society only makes the nominee a trustee of the property (post the owner’s demise) and not the legal heir unless the nominee’s name is specified in the Will as the heir to that property.

In respect of heirlooms that have sentimental value, not only is it important to mention the heir to a specific heirloom, but it may also be wise to mention why such a person should receive it.

🖱 Step 3 – Choose an Executor

Finding the person(s) who are/are close confidante(s) and who are willing to serve as the legal will’s executor(s) would be the second most crucial step.

An executor of a will is charged with gathering a person’s assets, paying off their debts from those assets, and then distributing those assets by the terms of the will.

The administration of the Will is what we refer to as this process.

To lessen the likelihood that the executor may pass away before the testator, it is ideal for the executor to be a dependable individual who is also younger.

If the executor passed away before the testator, the heirs would have to choose a new administrator, which would complicate matters.

🖱 Step 4 – Registration & Video Record

Although it is not required, it may be a good idea to register a will if the testator anticipates that the heirs would likely contest it.

A video of the testator reading out the will in front of a camera may also be kept by the testator.

All of these actions help to strengthen the Will and reduce its challenges.

🖱 Step 5 – Safely Storing the Document 

The testator should store the will in a visible location, like a cabinet, so that it is always accessible.

Additionally, you should leave a replica of your will with the attorneys so they have a record of your intentions.

The Format Of A Legal Will

Here is a starting format that is lawful even though the formats may differ.

Conclusion

Anyone can create a legal will while sitting in the convenience of their own home because it is a Do-it-yourself process. It doesn’t matter how much money you make or how many assets you own, either!

Throughout your lifetime, you are free to modify your will as often as necessary. Even though the process appears straightforward, it is always prudent to adhere to the very minimum requirements established by the law. It is strongly advised to have your will notarized to prevent any absurd consequences from occurring when the will is carried out. It is also to be noted that doing so is not necessary.

Credit: At our request, Advocate Vivek Arya, a litigation attorney currently serving the Supreme Court of India, generously conducted a review and shared valuable insights on this article for the PlanB community.

We’ll be back with more enlightening content shortly to keep you engaged and focused. While you wait, maintain your well-being, money, and safety.

Frequently Asked Questions (FAQs)

1. Why is having a legally sound will important in India?

Having a legally sound will in India is crucial as it ensures that your assets are distributed according to your wishes after your death. Without a will, your assets may be subject to legal disputes and lengthy court proceedings, causing unnecessary stress and financial strain for your loved ones.

2. Who needs a legal will in India?

Anyone who owns assets, regardless of the amount or value, should consider creating a legal will in India. Whether you’re married, have children, own property, or have specific wishes for the distribution of your assets, having a will ensures that your intentions are documented and legally binding.

3. What are the consequences of not having a legal will in India?

Without a legal will in India, your assets may be distributed according to the laws of intestate succession, which may not align with your wishes. This can lead to disputes among family members, delays in asset distribution, and additional expenses associated with legal proceedings. Having a will can help avoid these complications and provide clarity for your loved ones.

4. How do I create a legal will in India?

Creating a legal will in India involves several steps, including listing all your assets and liabilities, choosing heirs and beneficiaries, appointing an executor, and signing the document in the presence of witnesses. While it’s possible to create a will on your own, consulting with a legal expert can ensure that your will complies with Indian laws and is legally valid.

5. Can I update or modify my will after it’s been created?

Yes, you can update or modify your will at any time during your lifetime. Life circumstances may change, such as marriage, divorce, birth of children, or acquisition of new assets, which may necessitate changes to your will. It’s important to review your will periodically and update it as needed to reflect your current wishes and circumstances.

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