Nicolette Dirk, finance writer, Justmoney.co.za
Your passing away, at any age, will have a massive impact on your loved ones. The impact will be even greater if they also have to deal with finalising your estate without a copy of your will.
Thys Lotter, national sales and support manager for Sanlam Trust Limited, said what makes a will so important is that it is the final document that will determine how your money and assets are dispersed.
“People need to speak to their financial advisors to make sure their last wishes are carried out properly when it comes to this lasting document. A will might include a garage, but not stipulate the vehicle as well which means, the beneficiary could be excluded from inheriting it,” said Lotter.
Your children will be properly cared for
Planning the future care of your children in the unfortunate event of your death is an important reason to have a will in place.
“Children are the most at risk when there is no will, because if both parents die, they become wards of the state,” said Angela Mhlanga, head of Financial Consulting at Standard Bank.
She added that your children would ultimately be placed in the care of a willing relative, but in such traumatic circumstances, no parent would want their children to be worrying about who will look after them.
Create a trust
For the dependents you leave behind, your life insurance is important to ensure they are looked after beyond your passing.
“A will ensures that there are no unnecessary delays in the pay-out of the funds, and that the money goes to the correct beneficiary.
You can also make allowances for the establishment of a trust, so that whoever is caring for your children has controlled access to the funds until the children come of age,” said Mhlanga.
You can also make allowances for the establishment of a trust, so that whoever is caring for your children has controlled access to the funds until the children come of age,” said Mhlanga.
Save your family time and money
If you haven’t prepared properly, estate duty, capital gains and legal costs can take away a large portion of the inheritance that you leave behind.
Lotter said that there are many heart-breaking cases where families are left destitute after assets are liquidated to pay off debts left behind by the deceased.
“If there is no will with an executor nominated, it can take time to find one and this can incur additional expenses. Added to this, the chosen executor might not be someone you trust or would have chosen to have your family’s best interests at heart,” said Mhlanga.
Reduce family feuds
A lack of legal instruction can cause complications between various relatives.
“If, for example, you verbally promised your son your favourite painting but the executor follows directions and gives the painting to your daughter, then issues of resentment and frustration can occur,” said Mhlanga.
Lotter added that sometimes technical errors can cause a lot of heartache to loved ones who then will not be able to have access to their inheritance.
“In a case where a husband and wife sign a will, should the husband pass away she will not inherit anything. This is because no beneficiary is allowed to sign the will,” said Lotter.
Create a will now
Mhlanga said you can speak to your bank about drawing up a will that they will hold on your behalf, to deal with your assets appropriately at the right time. Although the costs of drafting the will are usually minimal, it is important to understand how the executors’ fees will be charged upon winding down the estate.
Standard Bank has a free online will application service that guides you through a step-by-step process of creating a will in a matter of minutes. Lotter warned that is it very dangerous to draw up a trust without experienced guidance and most financial advisors won’t charge you for an initial consultation.