FAIL TO PLAN IN ESTATE PLANNING

Fail to plan in Estate Planning can lead to unsolved estate inheritance distribution especially in Muslim families. Furthermore, it may also wreck the family relationship and lead to generation fights. Either Islamic Estate Plan or Estate Plan is part of core element in Financial Plan.

As a child, we definitely try hard want to support our parent until the end of their lives but what if we die before them?

A story to ponder

This is a story about a very successful entrepreneur, Mr Adam with lots of business networks throughout Malaysia, who died at quite young age.

Adam left his both parents who are already old, physically not so healthy, a wife and 3 children. According to the faraid law, his parents portions in the inheritance allocation should received almost half a million ringgit each.

Unfortunately, it was not happening accordingly. The wife had requested Adam’s parents to sign a consent form that allow her to take their distribution legally. She has agreed to hand over only RM800.00 every month to the parents for the rest of their lives.

Adam’s siblings were very upset over the matter. Furthermore, his father underwent medical treatment which required him to spend a big chunk of medical and hospital allocations. They managed to discuss about the matter together with the wife for the medical expenses allocation from the distribution. Still, she insisted to provide that RM800.00 every month with reasons, Adam left so many debts.

Obviously, it is sad to know that his parents had to sign something like that without his siblings’ consent or present. Worst, both of their parents are illiterate.

Being a child, how would we feel hearing this kind of incident? Can we imagine this happening to our parents? We should not allow such unjustifiable manner to be treated in  by our own beneficiaries.

Responsible to beneficiaries

Undoubtedly, it is important for us to manage our estate before we die because we cannot predict our own death. Either we are wealthy or otherwise, we should manage our estate the best we can possibly afford while we are still alive.

Any of our legal and Faraid beneficiaries must not be neglected. Educate our beneficiaries, the importance of estate planning so that they could avoid the possibility of ‘taking’, those are not belong to them unintentionally or otherwise.

Estate Planning Components

Estate planning in Islam has few components of documents such as Wasiat (Will), Hibah (Gifts), living trust and Matrimonial Assets. Each individual documents has different functions and purposes.