A conceptual study on religion, physical life, knowledge, family and wealth towards decision in estate planning: Qualitative approach

Abstract

Estate planning involves making plans for the transfer of estate after death. The estate includes cash, clothes, jewellery, cars, houses, land, retirement, investment, and savings accounts. This conceptual study examines the interplay of religion, physical life, knowledge, family dynamics, and wealth management in shaping estate planning decisions. Estate planning, traditionally viewed through legal and financial lenses, is deeply influenced by faith-based principles, particularly in religions like Islam and Christianity. Under Shariah law, inheritance mandates (e.g., fixed shares for heirs via Faraid) and obligations like Zakat (mandatory almsgiving) dictate asset distribution, while Islamic trusts (Wasiyya) and lifetime gifts (Hibah) harmonize spiritual duties with wealth preservation. Similarly, Christian stewardship principles emphasize charitable giving and ethical wealth management, framing assets as divine trusts. Family dynamics including complex structures like blended families—introduce challenges in balancing individual needs with collective harmony, often requiring mediation to resolve conflicts over asset allocation. Concurrently, knowledge gaps in estate planning tools (e.g., trusts, tax-minimization strategies) hinder effective wealth transfer, underscoring the need for financial literacy to prevent disputes and optimize legacy outcomes46. Wealth levels further dictate strategy complexity, with high-net-worth individuals leveraging trusts and philanthropic vehicles to align distributions with religious or familial values. Physical life considerations, such as health and mortality awareness, drive urgency in planning, particularly for healthcare directives and dependent care. The study synthesizes these factors into a holistic framework, arguing that effective estate planning must reconcile spiritual mandates, family equity, financial acuity, and personal well-being to ensure ethical, sustainable legacies. Challenges like regulatory gaps in faith-based compliance and跨generational communication barriers are highlighted, advocating for interdisciplinary approaches integrating legal, religious, and psychosocial insights. More than 90 per cent of Malaysians have not made a will as estate planning is not widely practiced. Among the reasons are procrastination and lack of urgency. Several reasons, including beneficiary ignorance, the expense of estate planning, regulatory restrictions, and the conviction that proactive planning is superfluous, are blamed for this lack of participation in estate planning. Difficulties in the management process have also arisen from the Islamic estate administration process's shortcomings and delays, including the unpredictability of property distribution among heirs. As a result, there are a lot of assets that have gone unclaimed, neither trust funds nor will have been created, and there isn't much involvement in Islamic estate planning. They believe that only the rich need a will and they have to build up wealth before writing a will. This conceptual study explores how Maqasid al-Shariah principles can be applied to determine what factors influence estate planning decisions in Malaysia. This study lays the groundwork for future inquiries and interventions in this area by examining the complex interplay between Islamic jurisprudence and estate planning choices.