Taking care of the future (when you're gone)
Death is an uncomfortable topic and evidently, a topic that most people avoid. A large number of South African pass on without a valid Will in place. This means that they forfeit the privilege of deciding how the distribution of assets should take place as the beneficiaries are then determined according to legislation. The rules of interstate succession come into effect in the absence of a legal Will. This can be hugely traumatic for the family and often ends up in disputes amongst family members.
Having a Will should form part of broader legacy and financial planning, and special focus should be given to estate planning. This will ensure that loved ones left behind don't have to cope with additional stress in an already traumatic stage of their lives.
National Wills Week will take place from 16-20 September 2019. This is a good time to take the first step in stipulating your wishes for your family members when you are no longer there, especially taking into considerations the needs of minor dependents. During this week, participating attorney firms across the country will help you draft a legally valid Will free of charge.
To get a free Will drafted during this week you will need your identity document, a list of your assets and you should put some thought into who will get what, who you would like to be the executor of your estate, and if you have minor children, who should become their guardian.
In the absence of a Will the Master of the High Court will appoint a person to administer the estate and all inheritances for minors will be placed in a Gaurdians' Fund for administartion by the Master. The Court will step in to manage the dissolution of your estate. During this process your assets and investments form part of the estate and your loved ones will have no access to your money. Could your family survive for such duration (6 months to several years!) without any money coming from your estate? Dealing with the courts and grieving at the same time is a heavy burden to place on anyone.
The estate administration process is highly technical and usually requires professional expertise. The executor needs specific documents of the deceased to speed up the administration process. If certain documents, such as title deeds of fixed property or share certificates, cannot be traced, the executor must obtain duplicate documents at the expense of the estate, which may create a delay. It is therefore very important to place all your important documents in a file and to tell someone you trust where the file is kept.
The executor will determine whether the estate has sufficient cash (money in the bank) to meet its obligations. If not, the beneficiaries are consulted about the way in which they intend meeting the cash shortfall. If they are unable to do so, the executor will sell assets from the estate to cover the cash deficit. Selling of assets often leads to lengthy negotiations with beneficiaries, auctioneers and others, which can delay the administration of the estate. Your Property Professional will be able to assist with the valuation and marketing of the property and present all documentation for signature to the executor. If the estate has enough funds to cover all expenses, the property will be transferred into the name of the heirs, once the required transfer fees have been paid.
It is essential to review your Will regularly to reflect your current wishes. Changes in your personal circumstances like the birth of a child, marriage or divorce can have an impact on how you want to have your assets distributed once you're gone.
See the list of documents an executor needs to finalise an estate in the relevant article on www.huizemark.com
To seek professional assistance and to have your Will drawn free of charge during National Wills Week this September contact the Law Society od South Africa on 012 366 8800 or visit www.LSSA.org.za.
Author: Adrie Barnard