A basic will may not always protect your family. A conditional will can help.

That’s where a conditional will—one that lets you define how, when and under what circumstances your wealth is passed on—can make all the difference. Families are increasingly using such wills to ensure their plans hold firm even when life takes an expected turn.

Conditional wills

As the same suggests, a conditional or contingent will takes effect only when specific conditions are met. If the condition isn’t fulfilled, the will becomes invalid.

Rajat Dutta, founder of Inheritance Needs Services, explains that such a will allows the testator—the person drafting the will—to anticipate potential changes in family dynamics. “They can include conditions either as precedent or subsequent to the bequest. In some cases, the inheritance may be tied to the beneficiary achieving certain milestones,” Dutta said.

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For instance, a parent can stipulate that a child inherits the family business only after completing their management studies. If the child fails to do so, they forfeit the business. Similarly, a father might condition his son’s inheritance on getting married.

However, these conditions must be reasonable and lawful. “The terms in the will must be practical and not overly burdensome. If they are illegal, the will can be deemed void,” said Satyajeet Desai, senior advocate at the Gujarat High Court.

Safeguard the future

The pandemic made Anshul Goel, a management consultant in Mumbai, realise that families can suffer multiple fatalities in quick succession. He therefore structured his will to ensure someone from his extended family could step in as the executor, the legal guardian of his minor daughter, or as a beneficiary if needed.

“One condition in my will is that if my wife and I are no more, the three executors I’ve chosen will carry out the will. I selected them carefully, ensuring that the chances of all of them being together under one roof are slim. The order of legal guardianship is based on my daughter’s comfort with the relative, and not necessarily on bloodline hierarchy.”

Goel also put in specific conditions on how and when his daughter could access her inheritance. “I don’t want her to receive the entire amount at 18. That much money at such a young age could spoil her. Instead, I’ve instructed the legal guardian to release small amounts periodically for her day-to-day needs. She’ll receive the remaining funds only when she turns 25.”

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Vishal Mehta, founder of legacy-tech startup Mitt Arv, has similar conditions for his primary inheritors. “If I pass away and my wife remarries while our child is still a minor, all of my wealth will go solely to my son. If he is an adult, the assets will be divided between the two. The distribution will also change if my parents are alive. I’ve even included nieces and nephews in the will.” Mehta’s will accounts for the possibility of divorce, too. “The status of my marriage at the time of my death will determine how my assets are allocated.”

Balance family dynamics

For married individuals with a spouse, children and parents, it’s essential to prioritise the well-being of both the spouse and parents before transferring wealth to the child. “You can state that the wealth will go to my child subject to the lifetime interest of my spouse and parents. Until then, the beneficiaries cannot have a clear title to the assets,” said Dhruv Chopra, managing partner, Dewan PN Chopra & Co.

“Another important condition could be that if a child wants to sell a property, they cannot do so without their mother’s approval and a promise of a portion of the proceeds,” Chopra added.

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It’s also important for the testator to prevent disputes over assets between the spouse and parents. “One of my clients included a condition to foster interdependence. He bequeathed the property where his wife lives to his parents and vice versa, ensuring they maintain a cordial relationship,” he added.

Many people also wish to contribute to society through their estates. “We advise such individuals to include conditions that require the next generation to donate a specific amount to charity for a set period or as a one-time contribution,” Chopra said.

Appoint trusted individuals

It’s also essential to plan for the possibility of incapacity to ensure your wealth remains accessible. “You can specify that your spouse or children are allowed to withdraw a certain amount if you are alive but unable to manage your affairs,” said Chopra.

“However, be careful not to overextend this provision,” he cautioned. “The goal is to empower one or more individuals to manage your responsibilities during such situations. For example, a businessman might designate a specific individual to attend board meetings on his behalf.”

Parents nowadays also consider scenarios in which their children marry later in life or not at all. “They should also account for the possibility of their children marrying partners who already have children from previous relationships,” Dutta added.

Plan for uncertainty

Even with all of this, it’s possible to overlook various scenarios while drafting your will. However, you can make subsequent changes, even if the will is already registered. “To update your will, cancel any previously registered wills, draft a new one, and ensure it is registered. For minor changes a codicil is sufficient, but it should also be registered,” said Desai.

You also need to be mindful of practical challenges when including conditions in your will. For example, you may want your child to inherit your wealth when he turns 25. Where will the money lie until then? Ideally, the executor will ensure it remains with him or in a suspense account, but a nominee, legal guardian or even the executor could spend it all. While the beneficiary can file a lawsuit, resolution can take years. Choosing the right executor is therefore critical. Consider compensating him or her for executing the will.

Should you include an in-terrorem clause?

Some lawyers advise adding an in-terrorem clause to your will to ensure beneficiaries do not dispute it. This clause says that any beneficiary who contests the will forfeits his or her share of the estate. However, Vivek Sadhale, co-founder of LegaLogic and GetWillDone, said such a clause does not offer more protection.

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Dutta said testators supposedly derive comfort by including this clause in their wills as they see it as a kind of an insurance for preventing disputes. “On the contrary, any individual can challenge the will in a competent court to establish its validity and genuineness. This defeats the very purpose of incorporating the in-terrorem clause,” said Dutta.

“When a beneficiary contests the will in a court, it essentially decides whether the right process has been followed in creating the will or not. If the will is valid, every provision in it is considered to be final, including the share of the contesting beneficiary,” he added.

Death is inevitable, but unpredictable. A conditional will that takes into account various potential scenarios can facilitate effective estate planning. It’s best to seek professional help to draft or review your will.