Inovatif

Category: Distribute Your Wealth

  • Trust In Transition: Ensuring Legacy Security Amidst Blended Family Dynamics

    In the intricate tapestry of family dynamics, Claire’s concerns (as you will read in the below true story) resonate with a challenge that many families face: the delicate balance between love and the protection of hard-earned assets. As we delve into Claire’s story, it becomes evident that estate planning and the establishment of trusts play pivotal roles in addressing these concerns, especially within the context of Malaysian law.

    This narrative serves as a poignant reminder of the importance of estate planning in safeguarding familial harmony and preserving financial legacies. In the context of Malaysia, where familial relationships are deeply intertwined with traditional values, the concept of estate planning takes on even greater significance.

    Within Malaysia’s legal framework, several statutes underscore the significance of estate planning and trusts. The Wills Act 1959 governs the creation and execution of wills, allowing individuals like Claire to stipulate the distribution of their assets upon their passing. Additionally, the Inheritance (Family Provision) Act 1971 ensures that adequate provision is made for the family members of a deceased person, highlighting the importance of thoughtful estate planning to avoid future conflicts.

    TRUE STORY
    Claire had become increasingly concerned as she noticed her husband, Krishna, growing happier by the day. It wasn’t that she didn’t share in his joy, but rather, she was troubled by the sudden return of his estranged son, Jay. Memories of the bitter quarrel that had driven Jay away were still fresh in her mind. Back then, Jay had demanded his inheritance from his late mother’s estate, but Krishna, citing his son’s youth, had refused. Tempers flared, hurtful words were exchanged, and Jay stormed out.

    Recalling that painful time, Claire had seen Krishna suffer deeply. It took the arrival of their own children to help him heal from the heartbreak. More than a decade had passed, and now, out of the blue, Jay stood at their doorstep. Unbeknownst to Claire, Krishna and Jay had reconnected secretly over the past six months, and it was Krishna who had extended the invitation for Jay to return.

    Krishna was overjoyed at Jay’s apparent change of heart, while Claire remained sceptical. Jay’s newfound kindness towards her, as well as his half-siblings, felt suspicious to her. A nagging thought took root in her mind – could there be ulterior motives behind Jay’s return? She couldn’t shake off the feeling that Jay’s intentions weren’t entirely pure. With Krishna aging, Claire feared Jay might be angling for a signifi can’t share of his father’s assets by mending their relationship. The prodigal son seemed intent on reclaiming his status as the favoured child, and Claire couldn’t ignore this undercurrent.

    The more Claire dwelled on her suspicions, the more anxious she became. She worried about the fate of her hard-earned money and assets in this blended family dynamic. As her husband’s wealth and their shared property were involved, she pondered whether Jay could eventually lay claim to her estate. Could he inherit a portion of her assets if she passed away before Krishna? These questions weighed heavily on her mind.

    Estate planning in situations involving blended families is inherently complex. Claire and Krishna’s case warranted a careful approach. One viable strategy was the utilisation of a Testamentary Trust, a legal arrangement outlined within a will that designates a trustee to manage specific assets for the benefit of named beneficiaries over a designated period. For instance, Claire could stipulate in her will that her assets, including her half-share of the house, would pass to Krishna and her two children upon her demise through a Testamentary Trust. To ensure her intentions were upheld, Claire might appoint a licensed trust company as the trustee, ensuring her assets would be held and distributed according to her wishes.

    In the context of Malaysia, where familial relationships are deeply intertwined with traditional values, the concept of estate planning takes on even greater significance.

    Alternatively, Claire could establish a Declaration Trust. This arrangement would empower her to serve as the primary trustee during her lifetime, with a licensed trust company stepping in as a substitute trustee after her passing. By executing this plan, Claire could ensure that part of her assets would not be transferred to Jay, even if Krishna’s will dictated otherwise. Assets she intended to safeguard for her children could be held within this trust structure, safeguarding her wishes.

    Navigating the intricacies of estate planning within blended families could be made simpler through these trust mechanisms. Whether employing a Testamentary Trust, a living trust, or a Declaration of Trust, individuals like Claire could assert their intentions without being overridden by their spouse’s conflicting desires, particularly in cases involving children from previous marriages. This thoughtful approach could alleviate Claire’s concerns and secure the future of her assets, bringing a measure of peace to this complex family situation.

    The true story of Claire, Krishna, and Jay was written and submitted to SmartInvestor by Rockwills. The Rockwills Group of Companies has operations in both Malaysia and Singapore, providing solutions and support services in the areas of succession, administration, and distribution of wealth. Rockwills started in 1995 and is the pioneer in the region to provide retail Trust, Will-writing and Will custody services. Rockwills is also licensed, respectively, in both Malaysia and Singapore to carry on trust business, and its services include acting as trustee of many family trusts and executor of many estates. Other services include the provision of comprehensive estate planning advice and offshore services.

  • The Amazing Reconciliation Of Father And Son, And This Reflected Inside The Will

    The Amazing Reconciliation Of Father And Son, And This Reflected Inside The Will

    The following story is based on an actual series of events, with some names and circumstances fictionalised. Any similarity to any person’s name, character, or history is coincidental and unintentional. Family in-fighting is common, but it should not hurt family ties and ultimately cause things to flow inside the will.

    David is a successful businessman who worked very hard building up his multi-billion dollar ceramic tile manufacturing business. So hard that he had little time for home and family, far less than he should have for bonding with his two sons, Ethan and Ben.

    Ethan was the older brother. A slow and steady person. Reliable. Non-controversial. Compliant. But unimaginative. He worked as the chief quality controller in his father’s business.

    Ben was a very bright child. The apple of his father’s eye during his younger days. The one his father hoped would take over the business in time.

    Read: He Had Everything But Children’s Harmony In The Family Business

    Don’t Make Hasty Decisions For Things Inside The Will

    One day, David called me to lunch at his office. Over dim sum, he told me he wanted to revise his will. Many years earlier, I had written a will for him when he wished to leave his business equally to his two sons and the rest of his assets to his wife.

    He instructed me to change his will to cut off Ben and set a small portion of his estate for a trust, RM10 million to be precise, to cater only for Ben’s basic needs for the rest of his life. I was shocked because his business, listed by then, was worth some RM500 million.

    “Are you sure?” I asked him. He suddenly looked downcast and said yes.

    “Why the great disparity between the allocations for the first and second son?” I asked.

    David said that Ben, after university, had worked in his company as the business development manager. Unfortunately, he became an alcoholic, to the deep disappointment of his father, and set a bad example in the office, often coming in late, slurring in his speech and reeking of the smell of alcohol.

    Read: Being An Executor Of Will Is Not As Easy As It Seems To Be

    Ties Can Be Repaired Before Finalising The Details Inside The Will

    I told him a clause would have to be added in the revised will to explain why he was excluding Ben from inheritance through the will. I also mentioned that he should talk with his wayward son before finalising the details inside the will.

    He said he had made up his mind, but I asked him whether he had considered that the underlying cause of the son’s behaviour and addiction could have been because he had been too harsh and draconian with the son without listening to his issues.

    He stopped in his tracks, stared into space and remained silent for a long while. He sent me off and said he would be in touch.

    After two months, he called me to meet again to discuss his new succession plans and to change the details inside the will. To my surprise, this time, his instructions were to leave the business 51% to Ben and 49% to Ethan.

    Anticipating my question, he said he finally concurred with Ben through a weekend trip. His son had turned to alcohol to vent his frustrations because of a perceived lack of listening ear from his father for many years. After many souls searching, the son had gone for
    rehabilitation treatment and managed to kick out his addiction.

    Needless to say, the father was ecstatic over his change and hence the revision of his will. Seeing the father and son reconcile after many years of misunderstanding was most satisfying as an estate planner. All because I had asked David a simple question, the family’s relationship improved, which was reflected inside the will.

    Read: Money Caused Breakup Among Four Close Friends, That’s Why it Is Important To Plan For The Succession Of A Business

    About Rockwills International Group

    Rockwills International Group, now in its 28th year, pioneered professional will writing in 1995 and has since evolved into the leading estate planning specialist in the country. It is today the largest provider of solutions and support services in trusts, succession, management and distribution of wealth. It has shareholders’ funds exceeding RM50 million. It has done over 280,000 wills and 15,000 trusts and holds more than RM25 billion in assets under trust.

  • Tragic Procrastination On Estate Planning Documents

    Tragic Procrastination On Estate Planning Documents

    The following story is based on an actual series of events, with some names and circumstances fictionalised. Any similarity to any person’s name, character, or history is entirely coincidental and unintentional. Hope that we better understand the importance of having estate planning documents set up as soon as possible.

    Ted was a close friend of mine. He had always struck me as a kind of bon vivant, enjoying life through fine foods and adventurous travels with a small group of friends.

    One day, out of the blue, he called me to meet up with him urgently. At a café in Damansara, he told me that he had just taken a health check that indicated heart palpitations, and he was due for a full heart check-up the following week.

    As such, he said he wanted to do a Will and a Trust, which he wanted to be done through me personally. I told him I was happy to oblige and started with a run-through of what he owned and owed.

    He had just moved into a large bungalow in an affluent area, and apart from various objets d’art and jewellery and four luxury cars, his biggest asset was his investment in Hong Kong.

    This was a trading company in which Ted had a 50% share, with a local Chinese who was his old schoolmate and partner for some twenty years. The company did very well in its contracts with China. The investment was significant because he could draw a salary of USD 50,000 monthly from the business and had been doing so for the last two years.

    However, the shareholding was in his partner’s name to fulfil local bidding requirements. He did not have any documentation to show his share of interest because they had both started the business based on trust.

    I told Ted that, apart from setting up a will and naming his distribution wishes, he had to, as a matter of urgency, set up a trust that his partner should sign, acknowledging his beneficial interest. He agreed and named his wife and two daughters as beneficiaries. He asked me to proceed with the estate planning documents as soon as possible.

    The estate planning documents were ready for him within a week, and we were to meet on a Sunday for him to sign. He, however, postponed the meeting to the following weekend and the weekend after that because of some ‘urgent business’ in Hong Kong he had to attend to.

    He said he would take the opportunity then to inform his partner of the trust deed to be executed. Unfortunately, he died of cardiac arrest on the eve of the day he was due to sign his documents.

    Just A Tad Late On The Estate Planning Documents

    All of us were in shock. The family and I gathered shortly after the funeral to review his files and estate planning documents.

    He had a rather messy record, but after painstaking work, it transpired that Ted had living parents and a sizeable debt – several million ringgit in the form of the house mortgage, a million ringgit in unsettled hire purchase, several hundred thousand ringgit in tax and about a hundred thousand ringgit incurred through ten credit cards.

    So, sadly for the family, they had to apply for letters of administration because of the lack of a will, and a quarter of Ted’s estate had to be shared with his parents.

    The most tragic part was that the so-called trusted friend and business partner in Hong Kong denied that Ted had any beneficial interest in the company shares (which were estimated to be worth USD 5 million for Ted’s 50% holding).

    In consequence, not only was the distribution of the estate considerably delayed, but the net value of the estate left for the family was drastically reduced, and the house they had just moved into had to be sold to pay for the debts in a moribund property market.

    It would have made a difference if Ted had signed his estate planning documents on time!

    About Rockwills International Group

    Rockwills International Group, now in its 28th year, pioneered professional will writing in 1995 and has since evolved into the leading estate planning specialist in the country. It is today the largest provider of solutions and support services in the areas of trusts, succession, management and distribution of wealth. It has shareholders’ funds exceeding RM50 million. It has done over 280,000 wills and 15,000 trusts and hold more than RM25 billion in assets under trust.

  • Caught Between Life And Death, The Importance Of Declaration Of Trust

    The following story is based on an actual series of events, with some names and circumstances fictionalised. Any similarity to any person’s name, character, or history is entirely coincidental and unintentional. Hope that we better understand the importance of having a Declaration of Trust.

    Simon would not be in a pickle if he trusted in the Declaration of Trust. Neither would his business be in such a predicament.

    At the prime of life and particularly having paid much attention to matters of health, he thought he was infallible and would not be robbed of his life at an early stage.

    He was right! He was not robbed of his life when a reckless motorcyclist running the red light rammed into him. But, it left him near lifeless in a comatose state due to swelling of his brain.

    With Simon in the hospital, his company was in limbo. Simon is the sole business owner. The company’s daily operations were impacted. Whatever he had wanted for the company in terms of succession and equity holding as expressed in his Will could not be effected and fulfilled.

    A Will and Last Testament could only be executed upon death and after obtaining the Grant of Probate. It would be different with a Declaration of Trust which would have avoided the current conundrum for Simon and his company.

    Simon had dismissed it when an estate planner told him about the Declaration of Trust. He shrugged it off as an attempt to sell him something he didn’t need, as he was confident that he had taken care of his estate planning needs with his Will.

    Had he listened, he would have learned that with a Declaration of Trust, he, as Settlor, could create a trust settlement by declaring that his assets are to be passed on to an appointed professional Trustee when anything drastic happens to him, such as incapacity. So, he is keeping the money for someone else, who is the beneficiary of the money.

    What Is A Declaration Of Trust?

    A Declaration of Trust would make it easy to transfer company shares quickly when certain things happen, such as when the only shareholder goes missing or is permanently disabled and in a coma. This would minimise any disruptions to the operations of the company.

    If a company has other shareholders and directors, the shares can be held in trust until the beneficiaries reach the age of majority. Meanwhile, dividends received can be used for the beneficiaries’ expenses such as medical, education, maintenance, etc.

    A Declaration of Trust is simple, flexible, and powerful to provide for loved ones by securing their financial well-being. It is NOT subject to Grant of Probate or Letters of Administration. It is REVOCABLE, and the contents can be changed anytime before the Settlor’s death.

    Any assets, whether encumbered or not, such as residential property, unit trusts/mutual fund investments, shares of private companies, and money in bank accounts, can form part of the Declaration of Trust.

    Under the Trust, the Settlor acts as the Trustee and retains control and ownership of the trust assets until a specified event happens, after which a substitute Trustee takes over to follow his instructions on how the trust assets are to be utilised. This prevents any delay in allowing your beneficiaries to enjoy the trust assets.

    As the Trustee, one need not transfer the assets until and unless one of the following events occurs:
     Death
     Total Permanent Disability (TPD)
     Critical Illness
     Comatose
     Resignation as Trustee
     Missing* for a period to be stated in the trust (this resolves the problem of lack of death certificate for the distribution of assets)

    No one knows what tomorrow will bring. One can be in perfect health, but circumstances are beyond control. So, be prepared—for your and your loved ones’ sake.

    About Rockwills International Group

    Rockwills International Group, now in its 28th year, pioneered professional will writing in 1995 and has since evolved into the leading estate planning specialist in the country. It is today the largest provider of solutions and support services in the areas of trusts, succession, management and distribution of wealth. It has shareholders’ funds exceeding RM50 million. It has done over 280,000 wills and 15,000 trusts and hold more than RM25 billion in assets under trust.

  • Being An Executor Of Will Is Not As Easy As It Seems To Be

    Being An Executor Of Will Is Not As Easy As It Seems To Be

    The following story is based on an actual series of events with some names and circumstances fictionalised and any similarity to the name, character or history of any person is entirely coincidental and unintentional. We will be taking a closer look at why the executor of will is not as easy as it seems to be.

    Elson and Jason were good friends for many years. They have met each other since primary school and even graduated from the same university. Growing up together, Elson would fend off those who bully Jason at school. They would also go to their makeshift secret base and play the whole afternoon after school.

    Jason was the only child in his family, and because of that he sees Elson as the big brother that he never had.

    As time goes by, these two boys have become men. They have both secured good jobs and beautiful and kind wives who bore them healthy children. It was a family that any man would be proud of with much love and warmth.

    Read: True Friend Dilemma, Declaration Trust Coming To The Rescue

    Not Ready To Be The Executor Of Will

    What seemed to be an ideal life for Jason soon came to a tragic end. What seemed like a normal cough, turned out to be lung cancer. Elson’s heart was shattered, he felt as if he was betrayed by a person that he trusted the most.

    “How dare he leave me behind?” was the first thought that came into Elson’s mind when he learnt of Jason’s departure. There were so many dreams that they had yet to achieve together.

    Elson made a promise to Jason that he will take care of Jason’s family and everything else. “Rest in peace my brother, I got you. See you on the other side.”

    Jason’s wife, Yvonne found Jason’s Will. It was a simple Will that named her as the beneficiary of every asset that Jason owned. Elson was named as the Executor in the Will. She wasn’t sure what an Executor meant, but since Elson’s name was mentioned, she guessed he may have known a thing or two about it.

    Read: Unfulfilled Wishes, Learn How To Protect Yourself

    Becoming An Executor Of Will, Is It A Nightmare?

    That starts with being the appointed executor of will to sort out what was left behind by Jason. Even with no knowledge or experience in administering the Estate, Elson thought, what could go wrong?

    A few months later, with the assistance of a lawyer, Elson obtained the Grant of Probate from the High Court. It was quite a straightforward though tedious procedure. All he had to do was to look out for the lawyer’s details of Jason’s assets.

    With the Probate in hand, Elson thought all he had to do now was to transfer the assets according to Jason’s instructions in his Will, which is quite clear cut to Elson. Jason’s Will basically says to give all his assets to his wife.

    Yvonne asked, “What about my husband’s debts? I know he has a few credit cards that needs to be settled.” Elson had an idea, if he could transfer all the liquid assets quick enough, then there would be nothing left for the bank to chase after.

    After all, Jason is long gone now. Who would sue a dead person? Yvonne was sceptical at first, but with enough assurance from Elson, she accepted everything that Elson was transferring to her. Elson had bypassed all Jason’s creditors in administering the estate.

    Read: Planning Is Important, Things Can Turn Ugly In An Instant

    The Executor Of Will In Action

    A few months have passed since, notice of due payment received by Yvonne has now become a letter of demand with a letterhead from a law firm that was appointed by the banks. To make matters worse, Yvonne also received a letter from the Inland Revenue Board Of Malaysia that is addressed to Jason to declare his income.

    As much as Elson tried to ignore the demands from Jason’s creditors, he soon learned that he was obliged by the law to pay up the creditors first, especially the tax due, which was one of the first priorities.

    All attention is now on Elson, with letters that legal action will be taken against him personally if he did not satisfy Jason’s creditor.

    “How does that even make sense? I’m just here to help, now I have to pay the price?!” Elson shouted at the lawyer whom he engaged for advice on what to do with the demands. It is either Elson calls back the assets that he has transferred to Yvonne, otherwise he will have to compensate the Estate’s creditors from his own pocket.

    Elson is now desperate. Yvonne had used most of the liquid assets that were being transferred to her. “I have warned you, it was you who assured me that everything is fine. I have used the money. I can’t give it back.” said Yvonne.

    While Yvonne was trying hard to scavenge whatever was left, Elson has been trying to see what he can sell off on his own to pay.

    It Is Tough Being The Executor Of Will

    mental health

    It was a very bad time for both Elson and Jason’s family that they must face. Being an executor of will sounded very easy, many did not expect there to be so many legal pitfalls until it was too late.

    It always starts with good intention to help, but often ends up in a relationship breakdown between the executor of will and the beneficiaries. Elson felt guilty that he had made the matter worse than it should be.

    Yvonne had to pull back from some commitments especially the children’s education expenses. Yvonne had to face the embarrassment, but for Elson, he is at risk of legal liabilities. If he is not careful, he could be facing criminal charges as his lawyer said to him this could be defrauding creditors if their claims are not recovered because of his negligence.

    A long legal nightmare is the likely outcome, that’s why it is not that easy being an executor of will.

    Read: Hard Facts About The Executor Of Will In Malaysia

    About Rockwills International Group

    Rockwills International Group, now in its 27th year, pioneered professional will writing in 1995 and has since evolved into the leading estate planning specialist in the country. It is today the largest provider of solutions and support services in the areas of trusts, succession, management and distribution of wealth. It has shareholders’ funds exceeding RM50 million. It has done over 280,000 wills and 15,000 trusts and hold more than RM25 billion in assets under trust.

  • True Friend Dilemma, Declaration Trust Coming To The Rescue

    True Friend Dilemma, Declaration Trust Coming To The Rescue

    The following story is based on an actual series of events with some names and circumstances fictionalised and any similarity to the name, character or history of any person is entirely coincidental and unintentional. Let’s look at how a declaration trust can help your friend, as they rightly mentioned “A friend in need, is a friend indeed”.

    True friends like Seng are hard to come by. But little did he know that being Donald’s true friend would put him in such a pickle.

    Seng found his pool of savings that he reserved for his old age depleting by the day. It had already been more than a year that since he alone shouldered the responsibility to meet the medical expenses of his buddy Donald after the latter fell into a coma.

    Donald, who is single and with no family members, has a successful interior design business where he is able to own a few properties and have a sizeable investment portfolio with a licensed fund manager. Donald have been procrastinating to get a medical and hospitalisation insurance policy because of the regular income he is getting from the property rental and dividends from the investments.

    He was diagnosed with severe case of Crohn’s disease last year which requires regular treatment and this year had to be hospitalised several times due to kidney failure. Seng has been footing his medical bill since whenever Donald had problems redeeming some of his investment to pay for his hospitalisation bills.

    A childhood friend, Seng, had been just a phone call away especially in recent years when Donald became sickly.

    In their childhood and adolescence years, they were dubbed as the village Siamese twins as they were rarely seen apart. Seng and Donald shared a very special bond. Even the separation during the years that Donald was studying in England did not see them go their separate ways after Donald returned.

    While they took different career paths and Seng eventually found the love of his life and married, the Siamese twins were still inseparable right through their old age.

    It became a routine for Seng to drop by Donald’s apartment every other day and also accompany him on visits to the doctor as his health deteriorated. When Donald was well enough, he redeemed some of his investment to pay Seng back for medical and hospitalisation expenses Seng paid for him.

    When Donald did not answer his phone call one afternoon, Seng rushed over and found his buddy unconscious. He rushed him to hospital and Donald had since then not woken up from the coma.

    As days and months went by, Seng became more worried for Donald. He was also weighed down by the mounting expenses he would have to continue to bear on Donald’s behalf. A dilemma one would not wish upon a true friend.

    Seng would not be in such a predicament had Donald had the foresight to plan for such eventualities. One estate planning tool that serves to take care of one’s affairs when incapacitated and not leave one in the quandary without financial support is the Declaration Trust.

    Read: Planning Is Important, Things Can Turn Ugly In An Instant

    What Is Declaration Trust?

    Conceived by Rockwills Trustee Berhad, one can set up a Declaration Trust, place certain assets in the Trust and appoint himself as the Trustee and have a licensed trust company like Rockwills Trustee as substitute Trustee.

    The Declaration Trust works in the event of specified triggers such as total and permanent disability, critical illness, disappearance for a period of time or death. Setting up the Declaration Trust, the settlor prepares a trust deed which are instructions for his wishes to be carried out when certain trigger events take place.

    Unlike the Will which only comes into effect upon death, the Declaration Trust allows the settlor to retain control of his assets while still alive and facilitates the drawdown of funds from the assets when he is, for example, incapacitated.

    Read: Hard Facts About The Executor Of A Will In Malaysia

    Donald as Settlor can in the Trust Deed include his investments and monies in his bank accounts as well as name himself as a beneficiary while alive. In the Trust Deed, he can name a trust company as the substitute Trustee, to have access to investments and funds to utilise them in the manner as he so wishes. He can also name beneficiaries to benefit from any balance of trust assets unutilised upon his demise.

    The Trust Deed will include a Power of Attorney for the substitute Trustee, which would be a Trust Company as it operates in perpetuity, to step in to administer the assets according to the Settlor’s wishes.

    The Declaration Trust has the advantage of distribution of assets to the beneficiaries without any delay when any one of specified triggering events occur and also the benefit of flexibility in safeguarding one’s interest pertaining to access to funds which otherwise could be locked down until death occurs or grant of probate in the instance if there is only a Will.

    Read: The Importance Of Estate Planning, Avoid Last Rites Drama

    About Rockwills International Group

    Rockwills International Group, now in its 27th year, pioneered professional will writing in 1995 and has since evolved into the leading estate planning specialist in the country. It is today the largest provider of solutions and support services in the areas of trusts, succession, management and distribution of wealth. It has shareholders’ funds exceeding RM50 million. It has done over 280,000 wills and 15,000 trusts and hold more than RM25 billion in assets under trust.

  • Protecting Our Children In A Divorce

    The following story is based on an actual series of events with some names and circumstances fictionalised and any similarity to the name, character or history of any person is entirely coincidental and unintentional. Hope that we can learn a thing or two about protecting our children in a divorce.

    Today, it is a sad day for Leng Chai. He got divorced from his wife, Maggie. They had a roller coaster marriage. During happier times, they became parents to twin girls. The court granted Maggie custody of the twins.

    Leng Chai spent so much time to build a successful business that he neglected Maggie and the girls in the process. Leng Chai and Maggie attempted several times to reconcile but each time, their relationship became more strained.

    As Maggie has been out of work for some time to care for the twins, Leng Chai is worried about the financial wellbeing of the girls (now three years of age) in case he dies before they grow up. Though Maggie knows that Leng Chai loves the girls, she is also worried that he may not keep his promise, like so many of the promises he made when they were trying to save their marriage.

    Maggie is also worried that he may remarry and neglect the twins especially when he has children with his new wife. Leng Chai, in turn, is worried that Maggie may remarry and neglect the girls to focus on her new family. The least he can do is provide for them financially.

    Read: Unfulfilled Wishes, Learn How To Protect Yourself

    Protecting Our Children In A Divorce

    One of the way to be protecting our children in a divorce, is by the way of trust. An easy way to resolve both Leng Chai and Maggie’s concerns is for Leng Chai to setup a trust for the girls. This agreement to setup a trust could be incorporated as part of their divorce settlement.

    The trust would need to be one that cannot be revoked by Leng Chai. If Leng Chai is allowed to revoke the trust, Maggie would be concerned because there is no certainty that Leng Chai will not terminate the trust arrangement in the future or amend it to benefit his new family.

    Leng Chai should approach a licensed trust company that is able to address his and Maggie’s concerns for a customised trust solution to be prepared, rather than using a boilerplate trust template. Having a trust company to act as the trustee ensures continuity of the trusteeship and accountability to the twins.

    As the purpose of the trust is to provide financial security to the girls, it is important to ensure that the assets placed into the trust provide sufficient funds for them even when Leng Chai is no longer around. Since Leng Hai intends to purchase a RM2 million life insurance policy, he can transfer it to the trustee together with the unit trust investments he owns that has a market value of RM1 million.

    With RM3 million in the trust, it makes the protecting our children in a divorce even better. The twins would have financial security to pay for their daily expenses, education, and medical needs in the future.

    Read: Fighting Over Equity Distribution, The Importance Of Succession Planning

    Taking Care Of The Children In Whatever Condition

    During Leng Chai’s lifetime, there should not be any distribution to the girls, but any dividends are reinvested by the trustee to increase the available amount for them in the future. Leng Chai can continue to provide financially for the girls before his death or disability.

    When death or disability occurs to Leng Chai or when certain conditions stated in the trust are met, it would trigger the trustee to begin disbursing the funds for the girls’ maintenance, education, and medical needs through their guardian before they are 18 years old.

    Leng Chai may want to indicate his investment preferences or give power to the protector to make such a decision. It would make sense for Leng Chai to appoint Maggie to act as the protector when he is no longer around. As the protector, Maggie would be the watchdog for the girls and liaise with the trustee on the needs of the girls from time to time.

    The trustee may also refer to the protector for an opinion before exercising its discretionary powers with a view of fulfilling the objectives of the trust and to benefit the twins.

    This trust arrangement for the twins should end when Leng Chai is no longer around and the girls reaching the age of 25 years. When they are 25, the remaining funds are to be given to them as a legacy from Leng Chai.

    At the same time, Leng Chai should have a will written where part of the instructions may give other assets to the twins when they reach a certain age. However, if he remarries, he will need to prepare a new Will as that marriage will revoke an earlier Will.

    Maggie in her Will may use her savings and assets to include a testamentary trust for the girls, should she pass on before they are 25 years old. With a testamentary trust, Maggie will leave clear instructions on how her assets should be used for the twins. This is similar to Leng Chai’s trust for the girls.

    There are a few differences between Maggie’s testamentary trust and Leng Chai’s trust.

    All Bases Covered: Protecting Our Children In A Divorce

    Read: The Importance Of Estate Planning, Avoid Last Rites Drama

    For Maggie’s testamentary trust to take effect, it is dependent on Maggie’s passing before her Will is probated and all her debts and taxes fully settled before the testamentary trust begins. It would be different for Leng Chai’s trust where it is not in his Will but in a deed which begins during his lifetime. Leng Chai would have to retitle the unit trust investments and insurance policy into the name of the trustee.

    By doing so, the trust will not be subjected to probate and debts, resulting in the trustee being able to use the assets for the girls immediately when Leng Chai is disabled or dies or even when he is having financial difficulty.

    In conclusion, by Leng Chai having a trust that is irrevocable for the twins with the right trust company as trustee, it will give reassurance to Maggie and the girls as well as fulfil Leng Chai’s intention to provide for them financially when he is not able to do so.

    This will address their concerns and both will have their wishes come true. And that is one way of protecting our children in a divorce.

    About Rockwills International Group

    Rockwills International Group, now in its 27th year, pioneered professional will writing in 1995 and has since evolved into the leading estate planning specialist in the country. It is today the largest provider of solutions and support services in the areas of trusts, succession, management and distribution of wealth. It has shareholders’ funds exceeding RM50 million. It has done over 280,000 wills and 15,000 trusts and hold more than RM25 billion in assets under trust.

  • Unfulfilled Wishes, Learn How To Protect Yourself

    The following story is based on an actual series of events with some names and circumstances fictionalised and any similarity to the name, character or history of any person is entirely coincidental and unintentional. Hope we are able to learn a thing or two about unfulfilled wishes, and how to protect ourselves.

    She must find it, and fast! It’s a race against time for Jane as for the umpteenth time she is rummaging through her best friend, Esther’s apartment for the latter’s 20-year-old Will.

    It was surreal like playing out a heart-pounding scene from a movie – a now or never or the protagonist would lose out to greedy adversaries.
    The adversaries in this instance are the estranged siblings of Esther who are starting court proceedings to claim her estate after she died intestate (without a Will).

    “They can’t. They can’t…” Jane mumbled as she frantically searched for that elusive Will. “It’s not what Esther would want…”

    Tears rolled down her cheek as she slumped among the mountain of documents, feeling helpless. This was the last ditch effort in keeping alive Esther’s wish for continued acts of compassion for the unfortunate and underprivileged even after her death.

    Read: The Importance Of Estate Planning, Avoid Last Rites Drama

    Prior to this and in desperation, she had even gone to banks where she knew Esther had dealings with to enquire whether Esther had safe deposit box accounts. In hope against hope, she had prayed that by explaining the special circumstances, she would get help to check whether Esther’s Will was there. All she got were sympathetic ears and the same standard response that without a Grant of Representation from the courts, the banks could not allow the opening of the safe deposit boxes.

    “I have failed you Esther,” she sobbed. For the longest time that Jane had known Esther, she stood tall for her big heart and generosity, something that was nurtured from young by her late parents. They had inculcated in her that being able to give unconditionally to help the less fortunate without any expectation of anything in return is one of the highest blessings.

    She learned from the example of her parents unlike her siblings. She saw how both her parents continued to give to charitable causes after death through how the instructions they set in their Wills. She emulated them when she later prepared her own Will and apportioned her assets, including those that she inherited from her parents, to certain selected charities.

    But it was a recent benevolent wish to do much more for charities with her accumulated wealth that triggered a series of events that eventually led to the non-fulfilment of her lifelong passion and her wealth landing in wrong hands.

    Read: Decluttering Tips For Safekeeping Of Wills

    She had wanted to re-write her Will that was drafted and finalised 20 years back to include more charitable organisations she had come into contact with through her volunteer work. She also wanted to seek advice on how she could give to charities over extended period of time after her death, just like the recent publicised case of a woman who, year after year after her death, still donated to orphanages through clever estate planning.

    However, as she started the process of consultation with a professional estate planner, she was dealt a cruel blow. A diagnosis of Stage 4 cancer. It shocked her. That sudden knowledge took a toll on her. Her health deteriorated and just too soon as the cancer spread, she passed on.

    Being a benefactor to many charities in her life, many representatives of charitable organisations turned up at her funeral to pay their last respects and shared eulogies of Esther’s philanthropy and selfless service.

    Her long-estranged siblings did not hide their ill will for her being the sole inheritor of their parents’ estate and their renewed intention to claim back what they felt was rightfully theirs.

    Her brother rudely proclaimed after the eulogy by the last speaker that charitable organisations can dream on in thinking they can get any money from Esther’s estate as it belonged to the siblings. They sneered at Jane who told them that Esther had intended to leave all her material wealth to charitable organisations.

    Jane could not stomach that and defiantly told the siblings that under the circumstances, Esther’s Will 20 years ago was still valid.

    With that, Jane had thrown down the gauntlet. She had to find the Will before the siblings secure a Grant of Representation for Esther’s estate to be distributed in accordance with the law for intestacy.

    In the end, without the actual Will to show, Jane lost in her bid for get Esther’s unfulfilled wishes to materialise.

    It is not uncommon for many to consider it task accomplished having written a Will. Without safe keeping for easy retrieval upon death, all efforts in putting down one’s wishes in the Will comes to nothing.

    It isn’t over until the important Last Will and Testament is in safe custody! Unfulfilled wishes like that of Esther’s just can’t be undone.

    Read: Hard Facts About The Executor Of A Will In Malaysia

    About Rockwills International Group

    Rockwills International Group, now in its 27th year, pioneered professional will writing in 1995 and has since evolved into the leading estate planning specialist in the country. It is today the largest provider of solutions and support services in the areas of trusts, succession, management and distribution of wealth. It has shareholders’ funds exceeding RM50 million. It has done over 280,000 wills and 15,000 trusts and hold more than RM25 billion in assets under trust.

  • Decluttering Tips For Safekeeping Of Wills

    Decluttering Tips For Safekeeping Of Wills

    The following story is based on an actual series of events with some names and circumstances fictionalised and any similarity to the name, character or history of any person is entirely coincidental and unintentional. Hopefully by following this decluttering tips, you will be able to safeguard your wills so much better.

    Mama Lucy is so into Marie Kondo to the extent that she has been increasingly NOT sparking joy in her family members.

    Her obsession with decluttering tips has been annoying for her family members after she came to know of Marie Kondo who gained world fame for her Japanese art of decluttering and organising.

    This was especially so in the run up to her move from the family’s 3-storey house to a two-room condominium unit. A day did not go by before her daughter and son receive calls telling them that she is getting rid of their this and that as they no longer spark joy!

    Decluttering Tips: Don’t Overdo It

    Daughter Jane and son Jay, who have started families on their own and moved out, will then have to make trips that very day to their family home to take the items that they wanted, otherwise those would end up in the garbage bag.

    “Her OCD behaviour is eating me up,” Jay would gripe to Jane, whose tolerance of Mama Lucy’s obsessive-compulsive disorder too had reached her limit. Mama Lucy had even coined her own mantra, Mati Kosong, in an adaptation of the Marie Kondo acronym for her decluttering mission!

    The siblings hoped their worries about her Mati Kosong obsession would dissipate after their mum finally moved to her new condo. They were right until a week later after the move…

    Decluttering Tips: Safekeeping Of Wills

    estate planning will
    Photo by Scott Graham on Unsplash

    Jane received a frantic call one evening. Her mum at the other end went like a runaway train… “I can’t find my Will. I took it out from the Will Custody Centre. I wanted to make changes to the Will. I just remembered it and have been looking for it the whole afternoon…

    “I have looked into the boxes and everywhere. What should I do…?” her voice trailed off.

    It should be worrying. A Will that cannot be located is like not having a Will. Luckily for Mama Lucy the discovery of her loss of the Will was not after her demise which would put her children through a lengthy and arduous process of getting a Letter of Administration before the distribution of her assets could take place.

    Mama Lucy had been prudent in keeping her Will in a Will Custody Centre prior to taking it out for review. Now, having lost it, she needed to go through the process of writing a new Will and making sure that it is safely kept and easily retrieved at the crucial time.

    Read: Hard Facts About The Executor Of A Will In Malaysia

    Decluttering Tips: Let The Professionals Handle It

    Photo by regularguy.eth on Unsplash

    A professional Will custody company like Rockwills Corporation Sdn Bhd which specialises in providing custody and protection of Wills ensures that Wills are kept confidential, free from any tampering and safe from any accidental or deliberate destruction.

    A strong room with fire resistant walls and doors, motion and smoke detectors, non-explosive lightings, and humidity control safeguard such important documents from accidental damage or destruction as in fire or flood.

    Biometrics security features allowing access only through card and fingerprint and 24-hour security are part of the secure system that include tight security processes of regular audit to ensure Wills are kept secure at all times.

    The additional feature of security stamp embossing in each page of the Will also ensures Will in custody are tamper-proof.

    Easy location is another merit of a Custody Centre. Legal representatives of the testator simply needs to provide the custodian with the death certificate and proof of identity, for the Will to be released to execute the process of the distribution of the estate.

    Hope you enjoyed the decluttering tips, just make sure that you don’t overdo it.

    Read: The Importance Of Estate Planning, Avoid Last Rites Drama

    About Rockwills International Group

    Rockwills International Group, now in its 27th year, pioneered professional will writing in 1995 and has since evolved into the leading estate planning specialist in the country. It is today the largest provider of solutions and support services in the areas of trusts, succession, management and distribution of wealth. It has shareholders’ funds exceeding RM50 million. It has done over 280,000 wills and 15,000 trusts and hold more than RM25 billion in assets under trust.

  • The Importance Of Family Foundation When Trust Crumbles

    The Importance Of Family Foundation When Trust Crumbles

    The following story is based on an actual series of events with some names and circumstances fictionalised and any similarity to the name, character or history of any person is entirely coincidental and unintentional. We will be looking at how a family foundation can help when trust crumbles within a family.

    Uncle Tan was shaken. It had just been revealed to him that something was not right in the books of the family’s hardware business.

    “It can’t be!” Uncle Tan was in denial even though San, the third of five children, showed him the books where the numbers didn’t add up. What was unbelievable to Uncle Tan was not the books but the accusation that Da Ge, his eldest son, has been putting his hand in the till.

    Business Runs In The Family

    Patriarch Tan has been happy and contented with Da Ge ably stepping into his shoes. As what one steeped in traditions would want, his number one offspring fitted to a ‘T’ the role of running the family business so that the 72-year-old founder could take a back seat and enjoy his golden years.

    Seeing how Da Ge has taken the bull by the horns in steering the company through some hiccups in business, Uncle Tan’s confidence in Da Ge grew over time and he showed his pleasure by giving his trusted son a free rein in the operations of the business.

    He was also contemplating on rewarding Da Ge with the largest share of the equity of the company and the rest, equally among the other son and three daughters. This, he felt, would sort of make up for the lack of attention for his first-born who grew up with scant fatherly love and attention.

    As one not attuned to showing affection, he neglected Da Ge and just focused on building up his business in his younger days. To him, his affection could be shown later by rightfully transferring his significant wealth to the eldest male offspring.

    And as Da Ge won his father’s heart with his business acumen, it blindsided Uncle Tan to his wayward ways. Easy success and access to cash from business transactions got to Da Ge and he became a spendthrift, splashing his money on wine, women and song and ego-tripping with his growing popularity and following by his cohorts of fan-friends.

    Tackling The Root Cause

    San got wind of the missing cash from his former classmate, who was keeping books for the company. After trying to talk to his brother but to no avail, he decided to bring the matter to his father.

    Knowing that his father would be in disbelief that his trustworthy son would be capable of endangering the financial health of the business, San thought it was best to go to his father with a solution rather than just the problem.

    He knew his father would be more receptive to a proposition for the betterment of the business rather than be presented with the problem that stemmed from his ‘trustworthy’ son.

    He could see that his father, when troubled that the foundation of trust had crumbled, welcomed his proposition that offered a solution. The older Tan was eager to meet San’s estate-planner friend to find out more about Family Foundation which would better resolve matters with Da Ge. He finally agreed to establish his own Family Foundation with a set of values and rules that ensured continuity and protection of capital.

    A Family Foundation can be established to hold and manage assets for the benefit of your family. It offers the benefits of a Trust and the structure of an independent company with protection of assets not available in others.

    The Importance Of Family Foundation

    For the Tan family, the Family Foundation offered an immediate resolution of the delicate situation rather than leaving the decision making on family business matters solely in the hands of Da Ker.

    The Founder of the family business, in this case Uncle Tan, can assume the role of Chairman of a Council to be set up under the Family Foundation. His five children can be appointed as members of the Council, who will be charged with managing the Family Foundation.

    Decision Making

    The Council assumes the task of decision making for the family business through the Council members’ vote of resolutions tabled for their consideration. This effectively makes it a collective decision-making involving relevant members of the family including the Founder instead of resting it in the hands of a sole family member.

    Family Governance

    Family governance is possible with the crafting of a Family Charter and the formation of a Family Council as it effectively becomes a platform or a forum for Family Council Members to voice their views, thus avoiding miscommunication or misunderstanding pertaining to the family business. It also facilitates the establishment of common rules and procedures to follow to minimise any possible disputes.

    Ring Fencing Family Wealth

    The Family Foundation serves as an essential instrument to safeguard business succession only among family members. This is achieved through ring fencing that keeps out outsiders and unwelcomed parties. This preserves the family business for the multi-generation of family members.

    Wealth Distribution

    Through deliberation and consultation, the Council can agree to a mutually beneficial wealth distribution formula. This pre-determined formula of shareholding in the family business based on identified scenarios will avert any possible future family squabbles that can break up the family.

    With Uncle Tan having his say and expressing his wish on succession and wealth distribution, his children being part of the decision-making process will see the distribution as fair.

    Comprehensive estate planning solutions such as the above can be achieved by consulting an experienced estate planner working with an established company such as Rockwills.

    About Rockwills International Group

    Rockwills International Group, now in its 27th year, pioneered professional will writing in 1995 and has since evolved into the leading estate planning specialist in the country. It is today the largest provider of solutions and support services in the areas of trusts, succession, management and distribution of wealth. It has shareholders’ funds exceeding RM50 million. It has done over 280,000 wills and 15,000 trusts and hold more than RM25 billion in assets under trust.