Estate Planning Is Job Best Tackled with the Help of Pros
By Saghir Aslam
(The following information is provided solely to educate the Muslim community about investing and financial planning. It is hoped that the Ummah will benefit from this effort through greater financial empowerment, enabling the community to live in security and dignity and fulfill their religious and moral obligations towards charitable activities)
Some people believe patience and a good do-it-yourself book will get them through any project. This may be true if you want to add a deck to your house or rebuild a car motor. But estate planning, like a root canal, is a procedure that is best left to the pros. I believe laymen should attempt only the simplest estate-planning procedures, such as drawing up a simple, uncomplicated will.
If you have a spouse and children and you want to leave each of them shares according to Shariah, with no other contingencies, a do-it-yourself book, if it’s accurate and well-researched, might help. The Islamic Society of North America (ISNA) has booklets available which can be directly purchased from them or from Islamic bookstores for small donations. But if you have a large estate and attempt a more complicated will, you most likely will create a problem rather than solve one.
Why? Books, software programs and do-it-yourself guides can teach you the basics, but they can’t cover the complex issues related to the lawful disposition of property. What’s worse, some of these materials are inaccurate, out-of-date or incomplete.
The states have different signing and execution requirements for wills. For example, if your state now requires two witnesses to sign a will, but if you use an old self-help book that says just one is required, there will be problems.
A will that lacks the proper signatures can only be corrected through costly court appearances. A poorly drawn will is also more likely to be contested by disgruntled heirs.
The worst-case scenario: People who take the do-it-yourself route and make a mess of it can completely reverse their last wishes.
Even those who write do-it-yourself books and software programs admit that complex wills, trusts and estate issues should be handled by professionals.
I believe even simple do-it-yourself estate planning efforts should be reviewed by a lawyer.
There is no such thing as a simple trust, and I am not so sure there is such a thing as simple will. People start with simple wills, then they think of conditions they want to add, and the will gets complicated.
I have suggested during my formal and informal sessions the importance of estate planning and most importantly having a will is a must. A task that must be done right now.
I have worked with an attorney who has studied and understands the Islamic inheritance laws. Make sure you seek professional help.
What’s a Trust? Knowing Terms can Simplify Process
Wills and trusts are the nuts and bolts of estate planning. With them, you create the framework for carrying out your wishes after you die. Without them, protecting and passing on your wealth to heirs and beneficiaries becomes much more difficult.
Most people know what a will is. But many folks don’t have the foggiest idea what a trust is. To clear up the confusion, with the help of an attorney, I have put together a glossary of key estate-planning tools.
Wills . Few of us would be without a will if we knew how much trouble that might cause our heirs. Without one, state law dictates who gets your assets. Loved ones could lose out to estranged family members. Still many of us don’t have a will.
A will is a relatively simple document. It should name an executor to oversee carrying out your wishes. If you have children, it must name a guardian. And it must be specific on how you want your assets-cash, stocks, real estate, family antiques-distributed to your heirs and beneficiaries. We are blessed that Allah (SWT) has spelled out the inheritance laws in the Holy Book of the Quran. We simply need to put it on paper according to the laws of the state.
A will’s coverage is limited to property you own individually and that does not have a named beneficiary. That means joint property with rights of survivorship goes to the other owner no matter what your will says. Life insurance, retirement accounts and tax-deferred annuities go by law to the named beneficiaries. So none need be included in your will. (To be continued)
(Saghir A. Aslam only explains strategies and formulas that he has been using. He is merely providing information, and NO ADVICE is given. Mr Aslam does not endorse or recommend any broker, brokerage firm, or any investment at all, nor does he suggest that anyone will earn a profit when or if they purchase stocks, bonds or any other investments. All stocks or investment vehicles mentioned are for illustrative purposes only. Mr Aslam is not an attorney, accountant, real estate broker, stockbroker, investment advisor, or certified financial planner. Mr Aslam does not have anything for sale.)