Leaving your family and loved ones in the best position possible after your death is an important priority that needs to be addressed sooner rather than later. Unfortunately, many people leave their wills and managing their estates to the last minute and simple mistakes can leave your loved ones in litigation over your estate once you have gone.
Do-it-yourself is best left for woodwork and not wills
Drawing up your own will can leave your loved ones vulnerable to confusion and dispute once you have gone. What’s more, your intended heirs can be disqualified from inheriting if:
- They have signed the will as a witness (unless your will has also been witness by two other competent people who are not receiving any benefit)
- They signed the will for the testator (even though in their presence and at their direction)
- They wrote out the will or any part of it in their own handwriting
These disqualifications exist to prevent fraud and prevent the exertion of undue influence over people in bad health or in a feeble stand of mind. Despite the importance of the will in ensuring your family and loved ones’ wellbeing once you have passed, 70%-80% of working South Africans are reported to have no will in place!
Estate planning is essential
Estate planning involves arranging your financial affairs in a well-structured manner that ensures your heirs are left in the best financial position possible. A well-structured estate plan will maximise your assets, reduce estate costs and taxes and streamline the winding up of your estate to ensure your heirs are paid out as quickly as possible.
A quick 7-point estate planning checklist
- Make a will. As we have discussed, a legally valid will drawn up by a professional makes a great deal of sense, if you want to leave your loved ones well taken care of.
- Deal with foreign assets. If you have foreign assets, you may need a foreign will as well as a South African will. It’s best to consult a professional about this
- Consider business continuity. If one of your assets is an operating business, it’s important you have a continuity plan in place, so business is not interrupted.
- Choose a trusted executor. Choose someone you depend on to ensure your estate is wound up as quickly and professionally as possible.
- Reduce costs and taxes. To maximise what your heirs receive, consult a professional to assist you with minimising estate duty, executor’s fees, income tax, and capital gains tax.
- Nominate beneficiaries. To avoid delays and confusion, nominate beneficiaries for your life policies, annuities, and investments. Different rules apply to different categories, so take professional advice here.
- Plan for liquidity. A professionally drawn up estate plan will plan for liquidity and ensure the executor is not forced to sell an asset to meet the various costs and taxes involved in winding up your estate.
Find professional advice you can trust
A professionally drawn-up estate plan guarantees both you and your family peace of mind today and in the future. At the EA Group. We offer an all-inclusive service, from drafting your last will and testament to administering your estate. We take a personal interest in your affairs and respect your wishes. For expert advice on creating an estate plan that will take care of your loved ones, contact us today.