Do you care and look after others that my not be a relative? If you want someone to be a beneficiary of your estate, especially when they are not directly related to you, you need to expressly mention them in your will as a beneficiary.
We saw lately in the news how much controversy it can cause.
Why draft a will?
- You have the opportunity in your will to state who you wish to be your minor child/ren’s guardians if both parents should pass away.
- Minor children cannot directly receive the inheritance you leave them and someone else needs to take custody of the inheritance to manage until the child/ren become of age. Where no provision is made for a testamentary trust through the instruction of the will, the inheritance is paid into the Government Guardians Fund or paid to the legal guardian to manage on behalf of the child.
- Clearly stating in your will what your wishes are regarding your assets and how they should be distributed between your heirs, ensures that there is no fighting between your loved ones.
- Executors, co-executors, and trustees should be nominated to take fiduciary responsibility.
Who can be nominated as executor?
- A relative or a close friend
- Your bank
- Your accountant or lawyer
- The Master of the High court would provide the following:
- A letter of Authority (estate valued below R250 000) of
- A letter of Executorship (estate valued over R250 000).
- The Master of the High Court might insist that they appoint a professional to help with the administration, the case of a close friend or relative.
Where property is inherited:
- Needs to be transferred regardless of whether the property is in two individual names and the one is still alive.
- This incurs transfer costs based on market value of the property, conveyance attorney costs, paying rates and taxes for a few months, clearance certificates and getting the bond figure.
- The property can only be sold with the Master’s approval at fair market value in the interest of ensuring there is liquidity within the estate.
What does liquidity (or lack thereof) in an estate mean?
- There is access to cash to pay debts and costs associated with winding up the estate.
- The executor is empowered to sell off assets to cover costs before the beneficiaries and heirs may inherit.
What happens if there is no will?
- Dying intestate will cause your surviving family members unnecessary legal headaches and may result in your money and property going to people who you would not have left them to otherwise.
Estate planning is therefore so much more than just securing life cover as you need to consider your assets, businesses, spouse, dependents, debts, and taxes.
Need someone to act as an executor?
WvdW Financial Services Inc can assist.