As an estate administrator, what is the first thing to be done in the administration of assets? Which assets of the estate need to be disposed of first? Which assets should be kept for the deceased beneficiaries? How would you deal with trusts set up for beneficiaries? How about accounts that belonged to the deceased? And the memberships he or she has had during his or her lifetime?
You might be tasked to deal with the administration of the assets according to the Will, the situation, the urgency of market prices and even the need of the beneficiaries left behind. And if you have no background whatsoever with the administration of properties, everything can be mind confusing for you. You could be worrying about messing up as an estate administrator. Or, you could be worried about asset protection and distribution of the same assets.
Now, you don’t have to stress yourself about all of this because we are here to help you. In this article, we’ll be discussing about the administration of properties. What are the things you should be aware of? And how you can apply estate planning principles in dealing with all the assets you have to distribute. Let’s start, shall we?
Administration of Assets – What assets should you prioritise first?
There are many kinds of properties you might be assigned to administer and distribute. It’s your job to come up with a list of all the properties owned by the deceased if the doesn’t have one. Now if there is a list of all the assets of the estate, the first thing you should do is to label them according to priority. Here’s a short list of the possible assets you will be made to oversee:
- movable assets
- real estate
- Insurance claims
Dealing with Movable Assets
The administration of properties like vehicles, artworks, furniture and other movable property must be dealt with accordingly. If the testator has instructed in his will that the properties are to be sold, or there is a debt to be paid. The main priority you should be concerned with is the price of each property. Vehicles must be sold quickly because they are depreciating assets. Artworks, on the other hand, accumulate value over time. So, if you are deciding between vehicles and artworks, it would be best look at the value of each piece, and always keep in mind their market price.
Other items that are not needed by the beneficiaries can also be sold off to give more resources to the estate. The main thing you need to ensure is that all the debts left behind by the deceased are paid off. But, do note that this is only possible if the estate is a solvent estate.
Dealing with Real Estate
For real estate left behind by the deceased, you must first ascertain the type of ownership of the property. If a commercial building, for example, is owned jointly by the testator with someone else then by the law of survivorship, the co-owner will inherit the property solely. But, if the property is held in a tenancy-in-common, then the shares would be passed down according to the will. If the deceased owned the property solely, then it is distributed according to the will. That is if there are no debts to pay.
Dealing with Bank Accounts
All accounts must be closed, and the contents are withdrawn. But, in order to do this, you need to show the grant of probate given to you by the court.
Dealing with Memberships
Similar with bank accounts you must end each membership by notifying the club of the death of the deceased. Some clubs allow for the transfer of membership to another family member. If it is economical for the beneficiary, then go through with the transfer, but if it does not then end the membership. The decision will be up to your discretion. After all, besides managing the estate assets, you must also be concerned about beneficiaries welfare.
Dealing with Securities
When a person dies with securities in his CDP account, steps have to be taken to update the account to an estate account before further transactions. Updating the CDP account will be left in your care since a CPD account is part of the administration of properties. You can ask for the deceased account to be transferred to the beneficiary’s account.
Dealing with Trusts
If the deceased had hired the services of a Trust company, then you’ll have to coordinate with the Trust executor. Especially if there are assets in the will given to the trust. Wills and trust often go hand in hand when it comes to estate planning. And if the deceased had planned his estate well then, he would have placed a large number of his assets into a trust.
Dealing with Insurance Claims
For CPF nominations and insurances, you must take the initiative to file the necessary paperwork so that the beneficiaries can claim the benefits. CPF monies, if they are stated in a cash nomination form, must be arranged with the CPF Board, and a new account might be needed for the CPF savings.
The administration of movable and immovable assets of the estate is a serious matter. It requires you to be thorough with your decisions. Making logical and rational decisions when it comes to assets left behind in your care is vital. Excellent management skills result in a successfully administered estate. So, remember always to put your head over your emotions, and you’ll do a great job at managing the deceased estate.