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Islamic Financial Planning: Will Writing

Islamic Financial Planning, an area fast gaining popularity among financial institutions and the public alike, is set to be a permanent product feature in Islamic Banking and Finance.
 
The following are some components of Islamic financial planning products:

1. Islamic Banking Services
2. Islamic Investment
3. Takaful

Other considerations when doing Islamic Financial Planning are:

1. Zakat
a compulsory tithe
2. Sadaqah
a charity
3. Hibah
a transfer of gift during one’s lifetime
4. Waqf
 a perpetual sadaqah mainly for the benefit of a communal
5. Wasiyah/Will
 a document declaring the distribution of assets after one’s demise.


This article will focus on the Wasiyah or Will writing.
 
The Will Act 1959 defines a Will as a document where a person states his intentions as to how his estate is to be administered and distributed after his death and who is to administer it. A Will may include provisions for guardianship, custody and tuition of a child. The Distribution Act 1958 also governs Will Writing for Non Muslims.
 
The Muslim Wills Enactment (Selangor) 1999 defines a Will as an Iqrar (declaration) of a person made during his life time with respect to his property or benefit thereof, to be carried out for the purposes of charity or any other purpose permissible by Islamic law, after his death.

Maybe because it is common knowledge that Islam dictates the distribution of wealth upon one’s death in accordance with the shariah under the faraid law (distribution law), will writing has not been popular amongst Muslims. What is not commonly known is, however, under the faraid law, a Muslim who owns properties is given permission to bequeath his properties to a charity organization or to anyone except the Quranic heirs.
 
Therefore, by drawing up a Will, a Muslim can bequeath 1/3 of his properties to the following:

 charitable purposes,
adopted children, if they have any, since adopted children are not entitled to inheritance according to the faraid law,
any other party who are not heirs as stipulated by the Quran.

The bequest of the Will can only be made up to 1/3 of the entire assets of the testator. Consent is required from the Quranic heirs after the demise of the testator, if the bequest made to the non Quranic heirs is more than 1/3 of the entire assets or to the Quranic heirs that is more than 2/3 of the entire estate.
 
Wills must be in writing and must have 2 witnesses. Wills will only take effect upon the demise of the testator.
 
Some of the advantages of having a will written are as follows:
 To protect the welfare of the heirs and those to whom one wishes to give one assets but are not eligible under the faraid law eg. adopted children.
To ensure that one’s assets are being distributed according to one’s wishes
To quicken the distribution of the assets so that there is minimal disruption to the lives of those left behind
To name the guardian

In the hadith compiled by Imam Al Bukhari as narrated by Talha bin Musarrif: I asked ‘Abdullah bin Abu ‘Aufa ra. “Did the prophet make a will?” He replied, “No,” I asked him, ”How is it then that the making of a will has been enjoined on people?“ He replied, “The prophet bequeathed Allah’s book”.
 
In conclusion, it should be the objective of every Muslim to be successful in this life and the hereafter, to submit to the calls as ordained by Islam. Hence, in every aspect of Islamic financial planning, one must take into consideration all that should be Islamic and halal. There should be no element of anything ‘haram’ in the investment and planning.

 

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