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Stephen Dsouza 22 Followers1w

Step towards financial freedom

#personalfinance #investments

Inflation (CPI) in US stood at 8.3% in August, higher than the estimated 8.1%.

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Naimishkumar Parmar 2 Followers1w

#personalfinance #financialliteracy #wealthmanagement

Why Nomination is Important?

Mutual Fund nomination refers to appointing a person to take charge of your fund investments after your death. Appointing a nominee ensures that after your death, your Mutual Fund holdings will be transferred to your nominee. This process of transfer of Mutual Fund units of a deceased investor to a nominee is also known as the transmission of units.

But bear in mind that a company or body corporate, partnership firm, Hindu Undivided Family (HUF), society, or a non-religious or non-charitable trust cannot be appointed as nominees. However, it is advised only to appoint a trustworthy person as your mutual fund nominee.

You can add up to 3 nominees in one mutual fund folio and specify the percentage share that each nominee will receive in the event of your death. If you do not specify the percentage share, your Mutual Fund units will be equally distributed among all the nominees mentioned in the nomination form.


What Are The Benefits Of Adding A Nominee?

1) It offers a smooth settlement process.

2) It reduces family feuds.

3) Removes hassles of producing a will. 

What Happens If You Do Not Have A Nominee?

It is important to appoint a nominee to ensure that your investments are passed on to the right person. However, as life gets busy, many of us forget to nominate a person. Sometimes, we may procrastinate updating the nominee. Other times, the appointed nominee may pass away unexpectedly and you might wonder how to claim Mutual Fund units after the death of the investor. In such circumstances, your legal heir can claim your assets. 

Mutual fund nomination just like a will document is an essential part of estate and succession planning. Hence, it should not be ignored. If you have invested in mutual funds or plan to do so in the future, make sure to add nominees.

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