This year is coming to an end at a rapid speed. There is still so much to be done before the December holidays and the last thing you want to think about now is your personal affairs, especially your will.
However, the reality is that according to the Road Traffic Management Corporation’s (RTMC) report from 1 December 2015 to 11 January 2016, 1434 fatal accidents occurred on South African roads and 1 828 persons died during this period.
It is extremely important to keep your will up to date, especially in changing circumstances, such as the purchase of a property or the birth of a child.
David and Vera has a 20 year old daughter, Anne, who lives with them while completing her studies. Their will, among other things, indicates that should they pass away at the same time, their estate will go to Anne. They are of the opinion that she will at least have a home to live in.
What they did not keep in mind, however, is that their life insurance will only be enough to settle the existing mortgage bond registered over the property. Unfortunately, they also have a lot of other debt and the reality is that should Anne not be able to pay the cash shortfall into the estate, the house would have to be sold to settle the estate’s debt.
Should David and Vera not pass away at the same time and the surviving spouse inherits the deceased spouse’s estate, the survivor will be faced with the same problem as Anne if they cannot pay the cash shortfall in the estate.
When you see an attorney for estate planning, it is important to disclose all information about your assets, liabilities and finances. Costs like the executor’s fee, possible estate duty, master fees and other expenses like your funeral expenses should also be kept in mind. Additionally, ensure that provision is made to meet your dependents’ daily needs.
The following is a broad guideline of the *capital that will be required:
Your debt +
Your funeral expenses +
Your monthly expenses for two years +
Provision for possible estate duty, executors fees, transfer fees, income tax return, capital gains tax on second property
= Cash needed in estate
*Capital in your estate can consist of physical cash in a bank account or investment, insurance policies, pension fund disbursements or estate assets that can be sold.
It is therefore advisable to take the following with you for consideration during your consultation:
|LIST OF INFORMATION NEEDED|
|Motor Vehicles (paid up)|
|Jewellery, Coin Collection, Valuable paintings with valuations|
|Details of Bank Accounts|
|Details of Cash Investments|
|Details of Funeral Policies|
|Details of Life Insurance Policies|
|Details of Retirement Annuities / Pension Fund|
|Details of endowment policies|
|Details of Shares of Business Interests|
|Details of Bonds over Immovable Property|
|Details of Debt on Motor Vehicles|
|Details of Loan Accounts and Credit Cards|
|Details of Personal Loans and Study Debt|
|Details of maintenance to divorced spouse / minor children|
|Details of all other debt and responsibilities ex clothing accounts|
It’s never easy to lose a loved one, therefore you need to ensure that the administration of your estate is as care free as possible for your family.
From 11th to 15th September, it is the annual National Wills Week, where participating attorneys set up a free basic will for clients. Contact MHI today for an appointment.
This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)