The Law Society of South Africa (LSSA) has encouraged the public to get their wills drafted by an attorney at no charge this National Wills Week.
September 17 marks the beginning of National Wills Week. “The aim of National Wills Week is to highlight the importance of having a valid will in place to ensure that the wishes of testators are taken into account when they die, and that their assets are disposed of according with their wishes,” LSSA told SA News.
Without a will, your estate will be distributed in terms of the law of intestate succession and may exclude people whom you would have preferred to benefit. Dying without a will might also result in your family having to incur extra and unnecessary costs. There might also be a delay in the appointment of an executor and conflict among family members might arise because there are no clear instructions on how to distribute your assets.
Although anyone from age 16 can draft their own will, LSSA warns “often a will is not valid because the person who drafts it does not have the necessary legal knowledge to ensure that the requirements of the law are met”. This is why it’s advisable to get a will drafted by an attorney, because they have the necessary knowledge and expertise to ensure that your will is valid and complies with your wishes.
We spoke to Tristan Naidoo, a Legal Adviser at Old Mutual Personal Finance, about the importance of a will.
Are there different types of Wills available in South Africa? If yes, what are they?
There are a number of ways to differentiate between Wills. A standard Will is made by one party with a straightforward indication of how their assets should be disbursed following their death. A joint Will is made by two parties, usually spouses. A Living Will contains certain instructions relating to your end-of-life wishes while you are still alive. A Living Will gives certain directives in the event of a grievous medical condition that would render you unable to make or express your own decisions. Living Wills are most often used to state that, in the event that there’s no reasonable chance of your recovery, you do not wish to be kept alive through artificial life support.
Another type of Will is one incorporating a Testamentary Trust into your Will. The Testamentary Trust only comes into existence upon your death, for the benefit of your nominated beneficiaries. The trustee who administers your estate will manage the Trust and ensure that your wishes are met.
How does one pick which Will is best for his/her needs?
Before you draw up a Will, you should consider holistic estate planning, of which your Will is one component. Estate planning is the process of preparing for the transfer of your wealth and assets after your death. An estate plan should include clear instructions about your assets, investments, life insurance, pensions, property and personal belongings, as well as debts. Determine what and how much you would like to leave to each dependent or loved one. This will be captured in your Will. Remember to allocate money for all costs to the estate.
Can a person draft their own Will and what advice would you give a person drafting their own Will?
Yes, a person can draw up their own Will. You can draw up a Will at age 16, with signatures from witnesses just 14 years old, on a form sold by most stationery shops. A DYI approach to your Will could however result in unforeseen consequences or your assets being allocated to those you did not intend. Drawing up a Will should be part of proper estate planning. As it is a crucial area of financial planning, it is worth getting professional advice if you are drawing up a Will. If you do not have a valid Will, you die intestate and the laws of intestate succession apply, which designates beneficiaries according to specific kinship.
What are the requirements for a valid Will in South Africa?
A person must be over the age of 16 (sixteen) years. The Will must be in writing. This means that a Will can by typed or handwritten. If the Will is handwritten, remember that the person who writes the Will is not allowed to be mentioned as a beneficiary in that specific Will. Each page of the Will, including the last page, must be signed by the testator. The Will must also be signed by two competent witnesses. A person will qualify to be a competent witness if they are 14 (fourteen) years of age or older.
How often can a person change his or her Will?
There’s no limit to how often a person can change their Will.
What is the best way to deal with paying minor beneficiaries?
A Trust can be established in your Will in order to hold and administer assets on behalf of a beneficiary who is a minor. Whether it makes sense to set up a Trust Fund depends on the beneficiary’s circumstances and the value of the assets.
Some reasons for setting up a Testamentary Trust include:
To provide for maintenance obligations.
To ensure that minors’ inheritances are managed by the trustees until said minors reach an age specified in the Will.
To administer assets on behalf of immature/handicapped beneficiaries during their lifetime.
What are the pitfalls that people should avoid?
Leaving estate planning too late: Life is short and it’s best to be prepared for the unforeseen.
Ensure that there is enough liquidity in your estate to cover debt and costs involved in the winding up process. This is one of the main purposes of estate planning. Many people often forget to make sufficeint provision for your dependents after your death. Forgetting to change your Will after major life changes: Update your Will when you get married or divorced, have a child or a death in the family. Other opportunities which may require a change or updating of your Will include legislative changes, a change in assets or significant changes in the tax amendment acts. Don’t forget to nominate an executor: You must appoint an executor in your Will. The executor is responsible for ensuring that the terms of your Will are carried out and that your estate is administered in terms of the law. Ideally this should be a professional person or trust company, who specialises in the drafting of Wills and administering deceased estates. Be mindful of taxes. Capital gains and income tax might be payable on death. The estate of a deceased person may also be subject to Estate Duty, after taking into account a deduction of R3.5 million against the net value of the estate. Estate Duty is levied at a rate of 20% against the dutiable value of the estate up to R30 million, and at a rate of 25% against any portion of the dutiable estate exceeding R30 million. Therefore, if the total net value of the estate is R4 million, Estate Duty will be due on 20% of the amount exceeding R3.5 million, which amounts to R100 000 (20% of R500 000). It is normally the responsibility of the Executor to pay the duty as levied on the property of the deceased. Seek professional help: A DYI approach to your estate planning may result in unintended consequences or protracted legal battles. Know and understand the law regarding estate planning. Like your financial plan, ensure your regularly review your Will and revoke any previous Wills by ensuring your most recent Will has the correct wording.
Where can people go to draft a Will and how much does a Will normally cost?
Should you need assistance with the drafting of a new Will, updating your existing Will or need expert advice on estate planning, speak to an Old Mutual adviser to weigh up your options and decide on the best path for you. The costs of drafting a Will may differ depending on the service provider used.
Examples in this regard are:
(a) A provider does not charge anything, if he is appointed as executor of the deceased estate in the Will.
(b) Another provider charges a fee of R350 for drafting the Will if the provider is nominated as the executor in the Will, or a fee of R1,000 if the provider is not appointed as executor in the Will.
(c) There is also a further provision that no fee is charged for drafting a Will where the provider is nominated as executor of a Will for a client who is 60 years of age or older, and the value of the estate is at least R2.5 million.
(d) Also bear in mind that an annual fee may be charged for the safekeeping of the Will, where the service provider is required to keep custody of the Will.
Find out where you can get your will drafted for free by clicking here.