I am 54-years-old and live with my wife and son . I own the house we live in as well as the adjacent house in which my mother resides. Additionally, I have investments in PPF (public provident fund) account, and various other assets. I am planning to write a will with my wife as the sole beneficiary. In case she predeceases me, I want the assets to go to my son. I want my mother to retain the flat till her demise, whereupon my son should get custody of that house. How do I accomplish all this with a will?
—Name withheld on request
As per your query, we assume that you are is a Hindu. Further, we understand that there is no right or interest of any other person in your properties and that the same were held only by you. We further understand that these are self-earned and self- created.
In a situation like this, the first option is creating a will.
You can draft a will for all your assets. The will should have details of the beneficiaries and details of all assets and investments. The will should then specify the distribution of assets as per your wishes.
With reference to the flat where your mother is residing, you should specify the property and insert a “life interest” clause to create a living interest for your mother. The life interest clause should specify clearly that you want your mother to enjoy the property for her lifetime. The property on which such a life interest is created cannot be sold, mortgaged or alienated by any method by any other person for the lifetime of your mother, thus will allow your mother to enjoy the property without any complications.
The will should be dated and signed by you and attested by at least two witnesses (preferably younger to you), appoint the executor in the will and have the same registered (this is optional).
In case of your demise, the executor has to seek probate on your will and distribute the assets as per your wishes.
The second option is to create a private family trust.
However, you would either have to transfer the property in the trust which will attract stamp duty levied at the market rate or make a provision in your will that the property gets bequeathed to the private trust upon your demise.
Here, the trust can have the terms where your mother will have the right to enjoy the property during her lifetime and only then will that be given to your wife or son.
A private trust is an effective vehicle to ensure a proper succession plan and does not require probate to transfer/ benefit from the property.
Do remember to update your will periodically to reflect changes in your assets, beneficiaries, or other circumstances.
Neha Pathak is head of trust and estate planning, Motilal Oswal Private Wealth.
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Updated: 22 Aug 2023, 10:26 PM IST