Sherry-Ann Mcgregor, Contributor

Mcgregor

Today's article answers some of the questions readers often ask when preparing a will.

It is best to name your beneficiary when you obtain a life insurance policy. When purchasing policies, you are usually given the option of naming individuals or their estate as beneficiaries. If the estate is named as the beneficiary, the proceeds from the policy will form a part of the assets for distribution on death; in which case, there may be delays in payment and transfer tax will be payable. If individual beneficiaries are named, the proceeds from the policy will be paid directly to the beneficiary and transfer tax will be avoided.

If there is a named beneficiary, the policy will not need to be mentioned in the will. The insurance company will only require proof of death in order to make the payment.

Present, future assets

Your will could take care of present as well as future assets. If it is drafted today, it can make provisions for assets acquired in the future. The way to ensure that all assets are distributed under a will is to insert a residuary clause. This clause will make a gift to named individuals of any assets which are not specifically devised in a will. In this way, the will does not have to be re-drafted each time a new asset is acquired.

In the absence of a residuary clause, assets that are not specifically devised in the will, will have to be distributed in accordance with the Intestates' Estates and Property Charges Act after an application for letters of administration is made.

The decision as to whether to give a gift under a will or to make an inter vivos gift is important. By transferring assets to your loved ones while you are alive (ie, inter vivos transfers), you are able to reduce the delays associated with having to obtain a grant of probate or letters of administration before the asset can be transferred to them. It also saves on expenses associated with administering the estate and interest if the transfer is not done quickly.

Choose wisely

However, you should choose the person to whom you make an inter vivos transfer very wisely, especially if that asset is the home in which you live. In some cases, the loved one to whom a person transfers valuable assets depletes them during their lifetime or prematurely ejects the loved one from the property and places them in nursing homes.

Perhaps an appropriate middle ground would be to add the person's name to the title as a joint tenant, so that the person will automatically inherit your interest in the property when you die.

Sherry-Ann McGregor is a partner and mediator with the firm Nunes, Scholefield, DeLeon & Co. Send feedback and questions to: lawsofeve@yahoo.com or Lifestyle@gleanerjm.com.