Death. That morbid subject nobody wants to talk about. Yet, it is inevitable. You may be wondering what death has got to do with money.
Well, living costs money. Dying costs even more money. In fact, your death might cost you and your surviving family members almost all the money and assets you had spent your entire life accumulating. You only need to ask spouses or families whose loved ones passed on without planning for that inevitable event. They know better.
A Life Skill
The need for you to come to terms with death has gotten critical on account of the financial implications of failing to make early and adequate preparations before it comes calling. Early and adequate preparations before you pass on are what estate planning is all about.
With recent global economic upheavals and its impact on people’s overall personal wealth, estate planning is now categorised as a critical life skill. It is basically about you consciously making very clear decisions on how you want all the money and property – your estate – that you have accumulated in your lifetime inherited or distributed after you pass on, and by whom. If you make such decisions and state them in unambiguous terms in your estate plan, using estate planning devices such as wills and trusts, then you are certain to dictate how your estate will pass on to your preferred beneficiaries, literally from the grave!
Please note, however, that it is entirely your choice to plan your estate. Where you choose to die WITHOUT planning for all the property or wealth you will leave behind, the governments of the States where you reside or where your houses are located will immediately commence their own already-made plans for your money and property.
Most states in Nigeria have existing laws that provide for how estates “not accounted for”, so to speak, are to be managed and distributed by the respective governments on the estate owners’ behalf. Governments earn generous income from the fees and charges slammed on estates not planned for by their owners at their death. Your family members get to inherit the remainder of your wealth only after the governments have deducted their fees and charges from your entire estate.
A Resource Custodian
There are numerous financial reasons that should drive you to quickly commence the process of planning for your estate today.
Before you go religious on this subject, as a lot of Nigerians are wont to do, think of yourself as having resources left in your care by the Supreme Being that you revere. If you take it that you are carrying out the job of a steward in managing the resources you were given in your lifetime, then you need to properly finish that responsibility through ensuring that you pass on the assets to other stewards worthy of those resources. Surely, you would not want to be directly responsible for the financial loss that may be incurred for the misuse of those resources.
Have you thought of the need for asset protection? Why would you work your entire life to acquire wealth – no matter how ‘small’ – and then become complacent in making sure its value is not diminished or eroded? Protecting your assets makes better sense if you take the measures while still alive as a lot of devices will be available to you for best results. Your passing on almost automatically denies your estate such advantages, with additional costs borne by it.
Costs to Survivors
A little dose of introspection would throw up questions that would indicate further potential costs to your surviving family and loved ones; avoidable costs if you really take the time to think and put together an adequate estate plan for their benefit. Ask yourself these questions:
“What will be the cost of letting my unplanned estate result in a family dispute and a battle in the courts between my wife and siblings? How about the loss of income from rental property that I owe if I fail to specify how the property should be managed and by whom? How will the outstanding loan facility I took be paid back from my assets? How will my children’s education be paid for till the university level? How will my wife or siblings access all the money in my bank accounts? How about my pension funds? Who will eventually take over my investment in shares? If anything happens to my wife after I am gone, who will take care of my young children the way I would want them taken care of?”
It is really amazing that, despite our current level of exposure, education and the numerous incidences of family conflicts and unending court battles over estates left behind by dead relatives reported daily in our clime, people still pay little attention to proper estate planning. Neglecting to plan your estate trumps up costs that will ultimately dent your purse, so please have a re-think now and do something, while you still have the opportunity to do so.