WILLS: DO YOU REALLY NEED ONE?
Recently, the world mourned the death of music sensation, Prince. Prince died without leaving a will, so where do all his riches – said to be close to $300 million – go now? It is likely to take years to be sorted out, and will probably be divided up between his siblings. This will leave no room for inheritance by his managers, close friends, or charities he supported, and what if children the world didn’t know about pop up and demand some money? While Prince’s family are trying to overcome the grief and shock of his passing, they also have to deal with him dying intestate. No family should have to deal with this – your will, will give you a voice when you no longer have one. So let’s all learn something from Prince: don’t die without a will.
But what exactly is a will? A will is defined as a written document in which someone, in accordance with ruling legal requirements, as set out in the Wills Act 7 of 1953 (hereafter referred to as the Wills Act), stipulates what should happen to his or her estate after death. Most people aren’t aware of the formality requirements as set out in the Wills Act, and so they may attempt to draft their own will without the help of an attorney. If this will is invalid – it can result in bitter legal disputes between potential beneficiaries of the will. Let’s take Alfred Nobel, for example. He is the man behind the annual international prizes that are handed out. When his will, which he wrote himself, was found after his death, it was confusing and lacked important details. The main issues were interpreting when a person was to receive an award, and establishing the foundations to hand out the award, which Nobel elected in his will but never actually consulted about it. Although in this case, his will was allowed, this was an exceptional case and steps should always be taken to avoid a messy and confusing will.
There are three types of wills that can come into existence. A single will – where one person makes his wishes known; a joint will – where two or more spouses make their wishes known in a single document; and a mutual will – where the testators bestow benefits on one another . If you have recently gotten engaged, married or are planning to have children, it may be a good idea to decide which one of these types of wills you would like to have and get it done as soon as possible. Although nobody likes to think about dying, you need to think about your loved ones, if something had to suddenly happen, and make provision for them so that they are not left confused or even more upset.
If a person dies without a will, or intestate, the government will use a default will to administer the deceased’s estate. The consequences of this are frequently problematic. The administration of the estate may result in unwanted heirs benefiting from the estate – and potential wanted heirs may lose out. The government will also appoint the executor of the estate, whereas if there was a will, the testator would appoint the executor therein .
The government will divide an intestate estate as follows:
Deceased is Survived by How the Estate is Divided
Only surviving spouse Total Estate goes to the spouse
Only descendants Total Estate is divided between descendants
Spouse and descendants The spouse gets a child’s share (R125 000), and the balance is divided equally between the descendants
Both parents Total Estate is divided equally between both parents
One parent only Total Estate goes to the parent
One parent & descendants Half the Estate goes to the parent ; balance is divided equally amongst descendants
No spouse, No descendants , No parents, but descendants through mother & descendants through father Estate divided into two parts:Half to descendants through mother and Half to descendants through father
No spouse, No descendants , No parents, No descendants through mother or father Estate goes equally to Blood Relatives that are nearest in degree of relationship.
It is possible to draw up your own will, but certain situations may be more complicated, and this should be avoided at all costs. So, if you’re married, divorced, own a business, own overseas assets, or have children under the age of 18, among other things, you should probably make sure you have a valid will. If you don’t, get one drafted as soon as possible.
A testator has the freedom to include any beneficiaries in his or her will. The executor of an estate, who is appointed in the will, winds up the estate by reporting to legal authorities, collecting all monies owed to the estate and paying any debts. If you have minor children, it is vital to appoint a legal Guardian for them, in the event of both parents dying or not being able to care for them. Any money left to minor children will be deposited into a Guardian’s Fund, unless stipulated otherwise in the will.
The benefits of having a will include that you may:
• Leave your estate however you intend and not how the Government dictates
• Ensure that those deserving people and organisations are included
• Incorporate provisions to reduce Inheritance Tax
• Appoint who you intend to act as your Executor or Executors
• Appoint who you wish to act as your Guardians for your children
• Give Funeral Directions
It is vital to regularly review and have your will amended, especially if more assets are obtained or beneficiaries are to be added or removed. Once a new will is made, previous wills need to be revoked in order to avoid confusion.
If you wish to create a will or want to have an existing one reviewed, contact us today.