Nomination in Financial Accounts
BankingNomination designates who receives the funds or assets in a financial account upon the account holder's death. Nominanting is the single most important estate planning action that most Indians overlook. Without nomination, families face months or years of legal hassle to access even bank accounts.
In detail
Where nomination is critical:nBank accounts (savings, FD): nominee gets access within daysnMutual fund folios: nominee processes claim without court ordernDemat accounts: nominee transfers shares within 45 daysnEPF: nominee gets the full corpusnInsurance: nominee gets claim proceedsnPPF: nominee can claim maturity amountnnSurvivors of non-nominees: to access funds without nomination requires:n1. Death certificaten2. Succession certificate from court (months of legal process, court fees, lawyer costs)n3. Affidavit and bondnnKeep nominations updated: change nominations after marriage, divorce, death of nominated person.
Real-life example
Ramesh died at 55 without nominations on his Rs 18L FD and Rs 12L mutual fund portfolio. His wife needed succession certificate from court -- 8-month process, Rs 80,000 in legal fees. Neighbour in same situation had nominated his wife -- she got Rs 20L FD and Rs 15L MF within 3 weeks without any legal cost. Nomination is the most impactful 5-minute financial decision.