Our ServicesEstate Creation

Estate creation is the process of building a financial reserve or legacy for future generations or specific causes using tools like insurance, trusts, wills, and tax-efficient plans. Through strategic estate planning, individuals can ensure a smooth transfer of wealth to heirs, charities, or businesses, protecting their assets from depreciation, taxes, and potential liabilities.

Why Mahavir Consultancy

We help individuals and the businesses in formulation of estate and its value creation

    1. Creates Immediate Wealth: A life insurance policy can provide a significant payout that adds to the estate’s value, even with a small premium (usually 2-3% of the desired estate value).
    2. Offers Tax Benefits: Certain life insurance payouts are tax-free, adding more value to the estate.
    3. Provides Financial Protection: Insurance can safeguard against unexpected events like death, disability, or major medical costs, ensuring assets remain protected.
    4. Enables Charitable Giving: Insurance policies can be structured to fund charitable causes, creating a legacy of philanthropy that can span generations

    Life Insurance-Based Estate Creation
    • Term Life Insurance: Provides a high sum assured at a low cost, suitable for creating wealth that beneficiaries can use.
    • Whole Life Insurance: Covers the policyholder for life, guaranteeing an estate payout to heirs or charities.
    • Endowment Policies: Combine insurance and savings, allowing the creation of an estate along with periodic savings returns.
    • ULIPs (Unit Linked Insurance Plans): Mix insurance and investment, offering long-term wealth creation and estate formation.

    Trust-Based Estate Planning
    • Family Trusts: Protect family assets from legal disputes, creditors, and taxes, ensuring smooth intergenerational transfers.
    • Charitable Trusts: Allow individuals to allocate a portion of their estate to charity, which can provide tax benefits while establishing a lasting philanthropic legacy.
    • Estate creation today is no longer limited to physical assets like real estate or land. The evolving concept of virtual estate creation offers an appealing way to build wealth digitally without the costs and maintenance issues associated with physical properties. Similar to sovereign gold bonds, this type of estate enables individuals to invest in a virtual property that grows over time and can provide rental-like income in the future without the complexities of physical ownership.
    • Insurance-based savings plans are an excellent tool for virtual estate creation. By paying a regular premium—often a small percentage of the target wealth amount (usually around 2-3%)—an individual can accumulate wealth over time. This structured savings plan grows without the need for property upkeep, renovation costs, or other typical property management concerns.
    • No Maintenance Costs- Unlike physical property, which requires repairs, taxes, and possibly renovations, virtual estates managed through insurance savings plans are hassle-free.
    • Guaranteed Growth-Most insurance savings plans offer a predictable return or a fixed growth rate, allowing for steady wealth accumulation.
    • No Depreciation-Unlike physical assets that may depreciate due to wear and tear, a virtual estate maintains or even increases in value over time and easier to liquidate when needed.
    • Insurance-based virtual estates often come with tax benefits under sections like 80C and 10(10D) of the Indian Income Tax Act, making them more tax-efficient.
    • Virtual estates can provide financial returns similar to rental income in the future. After the investment matures, individuals can receive a regular income stream (monthly, quarterly, or yearly), which acts as "rental income" but without the need to manage tenants or properties.
    • Even for small business owners or individuals, estate creation can be achievable and beneficial. For example: -Wealth Transfer Through Life Insurance: With low premiums, small business owners can ensure that their heirs or beneficiaries receive a lump sum, helping to cover taxes, debts, or other obligations. Charitable Estate Creation: Individuals can structure insurance policies to allocate a portion of their estate to a charity of choice, ensuring continued support to the cause they believe in, even after their lifetime.

      • Estate Creation: Simple Steps for Beginners
      1. Assess Your Assets and Goals: Determine what you wish to leave behind and to whom.
      2. Choose the Right Insurance Policy: Consult an advisor to select policies suited to estate building, whether through term, whole life, or endowment plans.
      3. Establish Trusts if Necessary: Trusts are particularly useful if you wish to shield assets or support charitable organizations.
      4. Review Regularly: Estate plans should be reviewed regularly to account for life changes or new goals.