Last week was national wills week in South Africa. In our line of work, we find that almost 80% of new clients we work with do not have an updated will or in some cases no will at all. We understand that death is not something that we like to think about, but the reality is that that day will come for all of us.
Most people will have a will drawn up when they get married, it is part of the “legal” package that we get when doing a marriage contract. Very often this is the first and last time we think about what will happen to our worldly goods when we pass. We can go in-depth into all the consequences of not having an updated will but let’s focus on some of the practical reasons we should bear in mind, as there is law in place which deals with dying intestate (no will).
Let’s start with what’s really important, family. If a couple has minor children and both pass, the state will have to appoint a guardian for their children. Most of us do not have much faith in our SA government, so leaving our most precious cargo at their mercy should be enough reason to get our wishes down on paper.
Furthermore, any wealth that is left to minor children will be administered by the “Guardians fund” which is run by the master of the high court. There are currently dozens of cases of fraud and theft being investigated by the SIU, so let’s leave that there. So, think about who gets to bring up your children and who manages their inheritance for them.
Something else many don’t know is that an instruction in your will does not override a beneficiary nomination on a life insurance contract, so make sure that this is updated as well, many people forget to change this when they end a relationship or enter a new one.
Retirement fund beneficiary nominations are just that, nominations. The distribution of your retirement fund interests is at the discretion of the trustees of the retirement fund. They must establish who is financially dependant on you and then allocate the funds accordingly. This can include, children, parents, spouses and live in partners.
Don’t skimp by doing a will yourself, find a professional who will do the job properly at a fair cost, yes you can negotiate the cost. Take a look at your will annually to make sure it reflects your wishes and keep it somewhere safe.
Dirk Groeneveld, Certified Financial Planner
t. 083 261 9287
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