Lack of wills, planning leaves nearly $15B in inheritance unclaimed in Malaysia

These include RM500 million in cash handled by government-appointed inheritance trustee Amanah Raya, RM60 billion worth of real estate managed by the Land and Mines Office, and RM4.5 billion in money held by the National Accountant Department, according to Malaysian newspaper Berita Harian.

Ahmad Feizal Sulaiman Khan, Amanah Raya’s group managing director, said the sum may have accumulated over the last decade, resulting in losses for families and the country.

Eugene Yeong, a lawyer and founder of Yeong and Associates, a company that provides estate management services, told the South China Morning Post that money left unclaimed in the government's consolidated trust account for 15 years will be moved to its consolidated revenue account.

"This means that after 15 years, unclaimed funds will effectively become government revenue," he explained.

Ahmad Feizal added that the economy is also affected as the unclaimed assets remain "frozen," hindering their use. Ownership issues stemming from unclaimed inheritance can, for instance, prevent land development, New Straits Times reported.

He pointed out that a major reason behind the issue is the lack of inheritance planning. Many assets remain inaccessible to heirs because their original owners did not establish inheritance plans or arrangements before they passed away.

Cultural taboos and superstitions surrounding death make many Malaysians hesitant to discuss estate planning or writing a will, according to experts.

"Additionally, there is a significant lack of public awareness regarding the importance of estate planning, leading to procrastination in will preparation," Yeong said.

Only about 5%, or approximately 1.7 million, of the country's 34 million people have made plans for how their assets will be handled after their death.

Without a will, families can struggle with complex legal procedures and extensive paperwork to claim a deceased relative’s assets.

For cases involving land, obtaining the required papers, which include not only a death certificate but also the birth certificates of the deceased parents and other property documents, can be a challenging task. Hence, failure to submit documents is another major factor leading to unclaimed inheritance.

Beyond the loss of assets, the absence of a will can cause conflicts and divisions among surviving parents, spouses, and children, particularly when properties have multiple joint owners, The Sun reported, citing Chong Mok Yong, senior estate planner at Rockwills, which offers will-writing services in Malaysia.

"Without clear instructions, disputes can arise among family members, leading to lengthy legal battles, strained relationships and in some cases, even financial ruin," Chong explains.

Associate Professor Dr. Adzidah Yaakob from Universiti Sains Islam Malaysia believes that existing laws are sufficient to ensure inheritance is managed and distributed fairly.

"However, disputes and selfish behaviour often arise due to a lack of understanding of inheritance procedures or laws," she told state news agency Bernama while urging people to learn more about inheritance laws in Malaysia.

Yeong said a simple yet legally valid will can be drafted for as little as RM500, with costs rising depending on the complexity and specific requirements of the client.

For some, the need to plan ahead comes only after reflecting on their own circumstances. Aishah Shamsuddin, 63, and her husband, both retired, had never considered writing a will.

They managed their savings carefully, ensuring they could send their five children to university. But when the question of who would inherit their family home arose, they suddenly understood that leaving things undecided could lead to serious disputes within the family.

Wanting to prevent potential conflicts, she has met with estate planning advisers in Kuala Lumpur.

"We are not rich, but the last thing my husband and I want is for whatever assets we accumulated to be the reason our children fight," she said.