Stian de Witt | Head | Financial Planning | NMG Benefits | mail me |
According to recent research from the Master of the High Court of South Africa, it’s estimated that 15% of South Africans who die have a will in place, which means that five out of six don’t.
If you die without a will, your estate will be intestate. This can be a long and drawn-out process, and the assets from your estate will not be in line with what you wanted.
Planning for the future isn’t just about finances, it’s about ensuring that you leave a legacy for your family. You need to plan and make deliberate decisions to ensure your loved ones are provided for after your death, and that your assets are distributed the way you want them to.
The differences between a will and estate planning
A will is a legal document that states how you want your assets distributed after your death. It includes your portfolio of property, money, and personal possessions. It also can specify how you want your debts and taxes to be paid, who should take care of your minor or special needs children, and even if you want to be cremated or buried.
Estate planning involves the structuring of assets in the most tax efficient way to ensure protection and preservation of assets from one generation to the next in a proper executable manner.
Estate planning is an integral part of responsible financial management. However, the intricacies involved often lead to confusion and oversights. That’s why we have launched Wills & Trusts to address as a solution for this, by offering a holistic and personalised approach to estate planning that aligns with each individual’s circumstances. There are five things every South African should know about a will.
It’s easy to draw up
Drawing up a will doesn’t have to be a complicated or expensive process. You simply must be of sound mind and legal age, and you must sign your will in the presence of a witness who is not a beneficiary of your estate.
You must update it regularly
Your will must reflect your circumstances and life changes – like new family members or changed marital status. Updating your will ensures that your assets are distributed according to your wishes and avoids disputes that can arise after your death.
Choose an executor
An executor is a person who manages your estate and ensures your assets are distributed according to your wishes.
An executor should be someone you trust, and who has the skills and knowledge to carry out the duties of an executor. They will be responsible for paying any outstanding debts, compiling and filling out your final tax returns, and ensuring the fair distribution of your assets to your beneficiaries in accordance with your will.
Consider setting up a trust
If you have minor children, you should consider setting up a testamentary trust to look after them. A trust is a legal entity that holds and manages assets for beneficiaries. It can reduce future estate taxes, while ensuring your loved ones are provided for.
Inform your family about your wishes
To help avoid any confusion after your death, talk to your family. This will help them make decisions and prepare for their own financial futures. It also gives your family peace of mind that your estate will be settled swiftly.
Talk to a financial advisor
Consulting a financial advisor will help you ensure your will is comprehensive and is part of your holistic estate plan. Your advisor will also be able to advise.
