Unlocking Opportunities in Estate Planning


Hamid Ayodeji writes on the benefits of estate planning

Estate planning is the process of anticipating and arranging, during a person’s life, for the management and disposal of his or her estate during the person’s life and at and after death.

It includes planning for incapacity as well as a process of reducing or eliminating uncertainties over the administration of a probate.

Clearly, the ultimate goal of estate planning can be determined by the specific goals of the client, and may be as simple or complex as the client’s needs dictate.

Estate Planning has been likened to a tree that grows from a tiny seed.
According to Leo Okafor, in his book ‘Living Trust,’ “the day you execute an estate planning instrument is the day you sow a seed from which the future and comfort of your loved ones begin to grow and their future become assured. The sooner you plant the seed, the sooner shall the tree grow.”

Experts described an estate as all the property owned by an individual, excluding liabilities. It is the net worth of the person or the value of the earthly possessions can be disposed or given away.

They further pointed out that an estate plan as a written expression of how a person wants his/her asset owned, managed and preserve during his/her lifetime and upon demise.

Estate Planning then involves the financial plan method used to effectively accumulate and protect one’s property, money, investment and assets during one’s lifetime and how the estate can be distributed efficiently upon one’s demise as stated earlier before the demise.
Estate planning was also likened to budgeting that helps control the future during and after your lifetime. This is an attribute of a prudent man or woman.

Indeed, what drives estate planning is the certainty and availability of current resources today and your ability to harness it; and the uncertainty when you no longer have capacity or you are gone, then what is left of your dependents and beneficiaries.

In fact, the experts stressed that estate planning is vital for everyone and not a function of one’s level of income or net worth. Whoever dies without making provision for how his estate is to be distributed or administered, would subject his asset to the law of intestacy which is imposed on him by law or custom.

For instance, under the Yoruba culture, if a man who is polygamous dies intestate, his property will be shared in line with the traditional method of Idi Igi – per stripe or Ori -Ojuri – per capital.

For idi- igi, the property is shared per branch. Each branch consists of a wife and children and the property is shared amongst the children of that branch while the wife/widow gets nothing. Although she might be entitled to a right of occupancy in the deceased’s house until she dies.

Under the Ori – Ojuri, the property is shared equally amongst all children. You can see the operation of this customs in the case of Danmole v. Dawodu; Suberu v. Sumonu.

But, where there are no children, the property will devolve on the members of the deceased man’s family.
The mode of distribution of a deceased person could vary depending on whether the disposition is by a man or woman. for example, if the deceased is a woman, under most cultures, woman are regarded as the property of the man, hence, all her estate reverts to her husband (in some cases except her share of her family/generation property which reverts to her maiden family) and the rest is history.

Unfortunately, most people have neither a will or a trust to identify their intention and desires after their death as they become so involved in their daily life activities that they gave little or no consideration to the consequence of not putting their house in order before their demise.

The consequence of the act of procrastination or non-performance can be financially devastating especially to your loved ones. The peace of knowing that your family will be well taken care of if something happens to you makes it worth the while to make adequate arrangement either through or a Will or Trust.
That is why the United Capital Trustees is offering a range of estate planning products and services designed to assist individuals in preserving their financial legacy.

Managing Director, United Capital Trustees, Tokunbo Ajayi, explained that, “Our products and services are confidential, stress-free, and cost effective regardless of your assets.”

She listed some estate planning tools of the firm to include Living Trust, Blind Trust and Family Trust.
For Living Trust, Ajayi explained that it takes effect during the lifetime of the settlor. This type of trust often is used by individuals with large estates to reduce estate taxes and avoid probate.

On the other hand, Blind Trust is usually used specially to avoid conflict of interest. In effect, the settlor gives up the right to information regarding the status of the asset.

For Family Trust, Ajayi said: “We offer Family Trust which has been developed to oversee family investment management, tax planning, succession, insurance, philanthropy and a myriad of other needs particular to the family.

“This protects liquidity, cashflow and ensures longevity of wealth over generations to come.
“Wills and Executorship: – The client’s wishes & desires as reflected in a Will are protected and executed efficiently after his or her death after processing a Grant of Probate

“Letters of Administration: In the event that a person dies intestate, i.e. without a Will, we as Trustees assist to apply for Letters of Administration (LA) in order to be able to administer the affairs of the Estate.
“Custodian Services: We offers custodial services to individual and corporate clients. We act as Custodians of important legal/title documents, share certificates and other valued articles belonging to our clients. Benefits includes safe keeping of assets as well as adherence to client’s wishes as stipulated in the Custody Agreement.”

In terms of its Dollar-Denominated Trust, she described it as a variant of our Private Trust products that caters to all Trust and Investment in US dollars, while its Endowment / Foundations was described as an arrangement/organisation designed to accumulate, preserve, manage, and utilise wealth over time for public/charitable purposes over a lengthy period or even in perpetuity.
Experts at estateplanning.com explained that an estate plan begins with a will or living trust.

According to the online platform, a will provides instructions, but it does not avoid probate.
“Any assets titled in your name or directed by your will must go through your state’s probate process before they can be distributed to your heirs. (If you own property in other states, your family will probably face multiple probates, each one according to the laws in that state.)

“The process varies greatly from state to state, but it can become expensive with legal fees, executor fees, and court costs. It can also take anywhere from nine months to two years or longer. With rare exception, probate files are open to the public and excluded heirs are encouraged to come forward and seek a share of your estate. In short, the court system, not your family, controls the process.
“Not everything you own will go through probate. Jointly-owned property and assets that let you name a beneficiary (for example, life insurance, IRAs, 401(k)s, annuities, etc.) are not controlled by your will and usually will transfer to the new owner or beneficiary without probate. But there are many problems with joint ownership, and avoidance of probate is not guaranteed. For example, if a valid beneficiary is not named, the assets will have to go through probate and will be distributed along with the rest of your estate. If you name a minor as a beneficiary, the court will probably insist on a guardianship until the child legally becomes an adult,” it added.