National Wills Week: Leaving a thoughtful legacy

Feel free to reach out to PSG Wealth adviser  Kobie Kritzinger directly. 

Most people are unprepared for death and lack a Will. The reason for this is that it is uncomfortable to discuss our mortality and equally uncomfortable to share our financial information, so we postpone these conversations and hope that it will not happen to us anytime soon.

What is the significance of having a Will?

A Will is a legal document that specifies who will inherit your assets when you die and also who will be the executor of your estate. Many people mistakenly believe that you can just share your final wishes with family members and everything will be taken care of. This is legally not enforceable and creates a very complicated situation.

If you die without a Will, your estate will be administered in accordance with the Law of Intestate Succession, which in essence follows your bloodline. Should you and your spouse pass away and you have minor children, they will be closest in terms of your bloodline and will inherit your assets. Minors are not permitted to inherit assets, and the assets will be directed to the Guardian Fund for management. You can avoid this by naming guardians for your minor children and establishing a testamentary trust to manage the assets for their benefit.

Your marital regime plays an important role when drafting your Will

If you are married in a community of property, your spouse is automatically entitled to an undivided half-share of your joint estate. If you are married out of a community of property with the accrual system included, the accrual claim will be settled first, and the residue will be divided amongst the heirs only after that. If you are not married but have a life partner unless it can be proven that your union was intended to be permanent, your partner will not be entitled to the same tax benefits as marital spouses. You can avoid these complications by including an affidavit filed with your Will that confirms the permanence of the nature of your relationship.

Offshore assets and your Wills

If you own assets in other countries, it is recommended that you have a separate Will to deal with these assets. Each country has its own estate duty and estate administration regulations, which should be considered when writing your local and international wills.

It is also important to remember that under current exchange control regulations, a local trust may not hold foreign assets. If you bequeath your entire estate to your local trust, the offshore assets will have to be repatriated to South Africa.

Your Will should be aligned with your Trust and business interests

Over time you may have created trusts and companies alongside your personal estate. It is critical to consider the validity and value of these structures in conjunction with your personal estate when drafting your Will.

Ruling from the grave

Leaving behind a complex web of wishes and conditions to heirs will cause delays in winding up your estate and may not be in the interest of your loved ones. 

National Wills Week: 11 – 15 September

It is National Wills Week. Why not use the opportunity to reflect on family, life, and death and finalise your Will? A skilled and qualified financial adviser will provide you with objective advice and assist you in drafting your Will.

Allow your legacy to be thoughtful and you will be remembered and loved forever.