Did You Know? Your FD or Bank Account Nominee Isn't Always the Beneficiary!
Think Your Nominee Will Inherit Your Money? Think Again.
Hard Truth: Even with a nominee, your family may still face probate to claim your money. And probate is no joke:
- It can take 6 months to 2+ years
- Legal fees can go up to ₹1 lakh or more
- During this time, your money stays locked, and your family suffers
Who is a Nominee?
A nominee is a person you appoint to hold or manage your assets after your passing. However, a nominee is generally just a custodian or trustee, not the legal owner of the assets. The nominee’s role is to safeguard the asset until it is passed on to the rightful beneficiary.
Examples of Nomination:
1
Bank Accounts & Fixed Deposits
If you nominate someone for your savings account or fixed deposit, they can access and manage the funds upon your death, but they are not necessarily the owner.
2
Stocks & Mutual Funds
SEBI guidelines clarify that a nominee only holds the assets in trust for legal heirs.
3
Life Insurance
In some cases, insurers allow a "beneficial nominee," where the nominee can also be the final recipient.
4
Property & Real Estate
A nominee may hold the property but does not become the legal owner unless they are also named in the will.
Who is a Beneficiary?
A beneficiary is the person legally entitled to inherit assets as per a will or law of succession if no will exists. The beneficiary holds the ultimate right of ownership, and the nominee must transfer the assets to them if they are different individuals.
Key Features of a Beneficiary
Mentioned explicitly in a will.
Has a legal claim over the asset.
If no will exists, inheritance laws determine the rightful heir
Can be a family member, relative, or even a trust/charitable institution
Legal Implications & Differences
| Aspect | Nominee | Beneficiary |
|---|---|---|
| Role | Custodian or trustee | Legal heir or rightful owner |
| Legal Rights | Holds assets temporarily | Inherits assets permanently |
| Mentioned in | Account forms (bank, insurance, stocks) | Will or legal succession laws |
| Ownership | No legal ownership unless specified in will | Full legal ownership |
| Purpose | Ensures smooth transfer, avoids legal hassles | Final recipient of assets |
Consequences
- Inheritance disputes
- Stress and confusion for your family
- Banks refusing access to your funds
The Solution
- Avoid confusion with a clear, legal will
- Understand the difference between nominee and legal heir
- Protect your assets with expert guidance
HOW WE HELP YOU CREATE YOUR WILL?
1
Client Inquiry:
You fill out our inquiry form. Get a callback from us.
2
Legal Consultation:
Our experts guide you through the process.
3
Asset & Beneficiary Planning:
Decide who gets what.
4
Appoint Executor & Witnesses:
Choose trusted individuals.
5
Will Drafting:
Legal document is prepared.
6
Registration:
We help you register it at the nearest Sub-Registrar’s office.
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