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13 important questions to ask when creating your estate plan

If you got sick, or were unable to make important decisions, is there someone you trust to handle your affairs? Would your business continue to run smoothly and your family be provided for?

Estate planning is about finding the best answers to these difficult questions. Let's take a deeper dive into it.

1. What documents do I need to prepare?

Documents needed for estate planning might include your will; the power of attorney document; financial and bank account information; insurance policies; and real estate deeds. Your executor should also be given a list of your assets and any debt; designated beneficiaries; and recurring payments (like utilities and subscriptions).

A power of attorney will handle your affairs while you are alive; an executor will perform this same duty when you are deceased (and the power of attorney document will terminate).

What you'll need will depend on your personal circumstances and where you reside. If you live in multiple jurisdictions, you may need one set of documents for each. These should be kept together for safekeeping, either with the executor, a lawyer, or in a safety deposit box.

Update your documents regularly to reflect any changes, such as getting married or divorced, moving to another country, or if you've nominated different beneficiaries.

2. I don't really own anything. Do I still need a will?

Your last will and testament is a legally binding document that clearly states your final wishes, ensuring your estate is distributed exactly as instructed. If you're young and single and have few or no assets, a simple will might suffice.

If you're married, your spouse will most likely be the beneficiary of your estate. But why take a chance?

Depending on how complicated your estate is, there could be serious consequences if you happen to pass away intestate (without a will).

Let's say you've been in relationship for 30 years and just assume that your partner will inherit everything. The laws are different for every country and not every jurisdiction will recognise your union. Separated, but not divorced? In many countries, your ex (and not your children) could inherit your estate if you forgot to update your will.

Even divorce may not automatically nullify a previous will, and remarriages can indirectly nullify children out of their intended inheritance.

groomsman helping groom with bowtie

3. I already have a will back in my home country. Is that enough?

In some cases, your will can cover both your home estate and your overseas assets. However, if those assets are in a jurisdiction with very different inheritance laws, your will may be considered invalid. In some countries, there are 'forced heirship' laws which may determine the beneficiaries of an estate.

If you feel you need some extra guidance, we offer full wealth and investment solutions, including legacy planning and estate administration for your assets worldwide.

4. What should my will include?

Your will is the most important document to be included in your estate planning. The process of creating a will can raise a lot of difficult questions for many of us.

You may be asked to appoint executors of your estate, beneficiaries, and guardians for your children. Business succession, philanthropy, and even provisions for your pets may also be covered. This list is not exhaustive - there may be other things to consider depending on your situation.

When estate planning, please take appropriate professional advice from a reputable law firm that specialises in international tax, trust and estate planning. Your bank or tax advisor can also support you.

Learn more: What to include in your will as an expat

5. What else should I include in my estate planning?

Estate planning is highly personal and will depend on your circumstances. Along with your will and important documents, you might also want to:

  • list your assets, such as real estate, funds, business and insurance policies
  • create a living will, which allows you make the difficult decisions now so your family doesn't have to
  • name a charity as beneficiary in your will
  • establish an inheritance plan for your children or your beneficiaries, if they are minors

Just keep your executor in the loop whenever you add or remove something from your estate planning documents. If you do have a will, it's worth reviewing it regularly to make sure all eventualities are covered whenever your circumstances change.

6. How long should I keep my bank statements and tax filings?

The recommended length of time you should keep these documents will depend on the country, as well as the period of limitation for tax assessments.

For example, for taxes owed or paid, the United States Internal Revenue Service recommends you keep your returns for at least 3 years from the date you filed your taxes. Australians are told to hold on to their records for at least 5 years from the date they lodged their tax return. In the UK, you're advised to keep your records for at least 22 months after the end of the current tax year, for returns filed before or on the deadline.

Precious documents can be kept in a disaster-proof safe or box, but there's no need these days to keep physical copies of all your paperwork. You can usually access your bank account, credit card details and loans statements online at any time. The HSBC Global Views and Global Transfers service even allows you to link your eligible bank accounts around the world and view them in one place.

For any tax-related questions, contact the appropriate tax authorities in your country for up-to-date information.

grandparents, couple and granddaughter at dining table

7. What will happen to my bank account when I'm gone?

This will depend on whose name is on the account, whether it's being held in a trust and on the local laws.

If you're the sole account owner, the account may be temporarily frozen once the bank has been notified of account changes. Any unpaid debt will usually be paid from the account when the estate is sorted. If you've named an executor of your estate or will, then this person will have the right to deal with your accounts.

Contact your bank to discuss your account if you're unsure of its policies around this.

8. Will a joint account be frozen?

A bank will not usually freeze a joint account. Most accounts are automatically passed to the surviving joint account holder (usually a spouse).

However, if one of the account holders is considered physically or mentally incapacitated, your bank may put a freeze on the account to protect the assets. Giving each other power of attorney means the remaining account holder maintains control of the account.

If there have been changes to the account, notify your bank to get a walk-through of the steps on how to proceed. The account will be changed from a joint account to a sole-named account holder if you've named a beneficiary.

9. What will happen to my outstanding credit card debt?

In most cases, credit card debt is the responsibility of the borrower. This applies to many countries and regions, such as the UK, Canada, Australia, New Zealand, Singapore, Hong Kong SAR, India, Malaysia, South Africa, the UAE, Bermuda, and the US (except in community property states, such as California and Alaska, where spouses can share both assets and debt).

Your relatives won't have to pay for your debt personally unless you share an account or have co-signed a credit card application with them.

When you pass away, debt collectors will not come after your home or car to cover your credit card bill; this debt will usually be paid from your estate. You can also choose to cover your credit card debt from other sources, such as an insurance policy.

To figure out the best strategy to pay off your credit card debt, or if you're unsure if your family will be liable for your debt, contact your bank. Now is the best time to clear that debt so it's one less thing your family has to deal with.

10. Can my spouse still use their supplementary credit card if mine has been cancelled?

Once the credit card issuer has been notified, all credit cards held by the deceased will usually be cancelled immediately, including any supplementary cards or those belonging to an authorised user.

If you have any regular credit card payments on the cancelled cards, this also means that they won't go through. Any outstanding debt will come out of the estate.

If you want to make sure your spouse has a credit card after yours has been cancelled, then they should apply for their own card and be the primary credit card account holder.

retired couple standing by vintage car

11. I have insurance. What will my family need to do?

Hopefully, you've kept all your important documents together. If the insurance company doesn't know the insured has passed away, can't find the beneficiary, or if the beneficiary doesn't even know they've been named on the plan, benefits can remain unclaimed indefinitely.

Claimfound.com reports there is currently USD70 billion in unclaimed money and property held by government treasuries in the United States alone!1

Many people buy insurance policies to protect their family from creditors who might come looking to collect debt money.

While creditors can go after your assets, they usually can't go after your life insurance benefits. These are considered to be completely separate from the estate and will go directly to the beneficiaries.

When in doubt, talk to a licensed insurance or wealth management advisor.

12. What should I do about my digital assets and virtual intellectual property?

Good question. Many people forget about their 'intangible' assets. Your digital inventory comprises your photos and music, email addresses, social media accounts and financial accounts. It also includes domain names, digital currencies and collections, and even games.

Some social media sites, such as Facebook, offer legacy management features. If you don't have this option but want to leave your digital assets to someone, make sure your executor can access them (as long as this doesn't breach user agreement laws) or nominate someone to manage accounts on your behalf. Another option might be to set up family sharing accounts that everyone can easily access.

13. How can HSBC's international services help me?

Getting your affairs in order goes a long way towards managing your global wealth and assets. It's also one of the best things you can do to protect your family's future, giving you peace of mind. At HSBC, we offer a full range of wealth management services for you and your family.

Learn more about our international services