Estate planning basics

Estate planning ensures wealth transfers to intended heirs efficiently. Tools: a registered will, nominations on accounts, joint holdings, trusts, gifts. India has no estate duty currently (abolished 1985, watch the space) but cross-generational planning still matters for tax, governance, and family harmony.

Will: signed, witnessed, registered (optional but recommended). Nomination: trustee for the asset, not the owner — the legal heir overrides nominee unless the asset is in joint name. Joint holding "either or survivor" gives operational ease but transfers ownership at death. Trusts: useful for HNW with multiple heirs, minor children, or special-needs beneficiaries; setup and ongoing cost is significant (₹50K-2L+ annually). HUF: tax-saving structure for joint-Hindu families; benefits compressed post-2017 but still relevant for some asset classes.

A practitioner nuance: the "letter of wishes" alongside a registered will. While the will dictates legal distribution, a letter of wishes (separate, non-binding) explains the rationale to heirs — reducing dispute risk. For HNW, a private trust with class-based beneficiaries (e.g., "spouse and lineal descendants") is more flexible than a fixed-share will and protects assets from creditor claims and divorce settlements of beneficiaries. CFP-level estate planning increasingly uses these instruments.