Personal finance for ordinary people

Feel free to reach out to PSG Wealth Adviser Ross Marriner directly.

If you have been named as a beneficiary or appointed executor in a deceased estate, you will be familiar with the lengthy process of estate administration, exacerbated by significant delays at the Masters’ Office.

The Masters’ Office, a division of the Department of Justice, is responsible for the registration and supervision of the administration of deceased estates. The Masters’ offices have not been functioning as they should for several years and factors such as the COVID-19 pandemic and loadshedding have exacerbated the situation.

But what do these delays mean for the average person? The process of appointing an executor by the Master of the High Court can take anywhere from a few weeks to several months. Once appointed, the executor not only has to engage with the Masters’ Office, but also with other government departments such as the South African Revenue Service and the Department of Home Affairs. As a result, beneficiaries of an estate may find themselves waiting months—or even years—before receiving any assets, such as cash, investments, or items specified in the will of their loved one.

So, what can be done to ease this process? First and foremost, it is essential to work with a fiduciary practitioner to ensure your will is legally sound, your wishes are feasible, and that there are enough funds in your estate to cover your intentions.

Secondly, you should engage with an experienced Certified Financial Planner® to structure your investments in such a way that some of your assets fall outside of your estate when estate duty and executors’ fees are calculated. Moreover, some of your investments can be arranged to pass directly to your beneficiaries without needing approval from the Masters’ Office, which will expedite the process in the event of you passing away. You should also ensure there is sufficient liquidity in your estate to support your beneficiaries while the estate is being finalised, avoiding the need for your executor to sell assets to cover estate duties.

Certain products are outside the jurisdiction of the Masters’ Office, including retirement funds like retirement annuities, preservation funds, and living annuities, as well as life-wrapped investment products such as endowments and sinking funds. These products allow you to designate beneficiaries to receive the proceeds upon your death, enabling your loved ones to access funds while waiting for the rest of your estate to be settled.

If, however, you choose to name your estate as the beneficiary of any investment, the proceeds will be paid into the estate, potentially delaying the distribution to your beneficiaries.

Having a well-thought-out estate plan is crucial, especially when dealing with the potential for long delays at the Masters’ Office. While coping with the loss of a loved one is difficult enough, not having immediate access to cash can put a significant strain on families. An experienced Certified Financial Planner® can assist you in structuring your investments in a way that meets your specific needs and minimises delays for your loved ones.