Unfortunately, although many people believe they have executed a legal will that reflects their wishes, that’s not always the case.
Several common mistakes in making a will can mean that the document is invalid or does not accurately reflect the intentions of the testator (the person writing the will).
- Choosing A Bad Executor
Your executor is the person who will administer your estate, so choose someone you trust. If your executor cannot serve in this capacity (e.g., no longer of sound mind, has died, too emotional), you need to change the executor in your will.
Also, let the executor know you’re choosing him or her before you draft the will to make sure they will accept the responsibility.
- Forgetting About the Kids
It is critical that you name a suitable guardian (both physical and financial, these can be different people) for any minor children in the event of the death of both parents. Again, get the consent of the guardian before drafting the will.
Also, if you intend for your children to inherit differently, clearly distinguish between children if you have children-by-birth, stepchildren, etc.
- Forgetting Assets
Everything you own must evident to be submitted with your will along with a provision for its distribution. Include what-if provisions, too, in the event that a named beneficiary cannot inherit as intended (e.g., the beneficiary has died).
One way to avoid the “missing asset” mistake is to update your will whenever you acquire anything new, but oversights happen, so a residuary or “leftovers” clause is key. This provision ensures that any assets “leftover” (not specifically named in the will) are still given to your beneficiaries of choice.
If you have property not included in the will and no residuary clause, you’ll land squarely in the land of the intestate (or at least partially so with regard to the missing assets).
- Forgetting About Taxes, Debts, And Other Financial Considerations
Not considering potential debts (such as your own debts and bills plus any income, gift, or capital gains and death taxes) could mean your beneficiaries inherit less than you wanted.
Some property such as life insurance proceeds and trusts, although not in your estate, may still be taxable in certain countries so keep updated with the (ever-changing) rules.
- Forgetting The Details
Describe all gifts and bequests clearly so everyone knows exactly what you mean. If you think there might be some familial fighting, include reasoning for your decisions. You can attach a Letter of Wishes to be more explicit with details.
- Getting The Facts Wrong
Get the facts straight regarding your assets and beneficiaries—locations, descriptions, beneficiaries’ relationships to you, etc. Leave no room for doubt as to how you meant your property to be distributed.
- Not Using Full, Accurate Names
Double and triple-check that you’ve got everyone’s legal names correct in your will.
- Not Executing Will Properly
Once you create a will, it must be executed according to your country’s law or else it won’t be valid.
Usually, you need to sign and date the will and have at least one witness, but requirements vary greatly, so check your asset’s country law for details (some countries won’t allow a “foreigner” to inherit property/land for example.)
- Not Executing Codicil To Will Correctly
Up until your death, you can change your will whenever you like in a common-law country such as HK.
Amending a will through a codicil, however, often needs to be done in a particular way according to HK law, so you must be certain you’re abiding by it in order for your changes to take effect.
- Forgetting To Update
Births, adoptions, deaths, divorces, moves to a different country, new business ventures—these are all life events that should prompt you to take a look at your will and make sure everything is up to date.
Ensure your loved ones and property are protected