To ensure that your estate devolves efficiently and cost-effectively, and with the minimum of inconven-ience to your family and heirs, it is important to ensure that you have a properly planned and up-to-date Will. Your Will should also be reviewed regu-larly. Here are some points to consider when re-viewing your Will:

 

Change in assets / personal circumstances

 

You should review your appointment of heirs regu-larly to keep up to date with changes in your family circumstances e.g. marriage, retirement, purchase of a property, death of a spouse or family member. If you are recently widowed, remarried or divorced, it is advisable that you execute a new Will. Your previous Will may not be adequate.

 

Testamentary (Will) trusts

 

You may wish to create a Will trust to administer funds inherited by your spouse, children or grand-children, or disabled or incapacitated heirs, or heirs who lack skills to administer monies. Testamentary trusts can also be used to reduce the future income tax obligations payable by your spouse and heirs.

 

Executor’s fees

 

The fee of the person or institution named in your Will to attend to the winding up of your estate is negotiable – but not after the event. Executor’s fees can constitute a major expense in an estate. If you have simply taken up the generous advice of the bank or attorney who drafted your Will, that they be nominated as executor of your estate, without dis-cussing the fee, then the legal tariff will apply (currently 3.5% plus VAT based on the value of the estate assets). For example, an estate worth R3m (say consisting of a residence valued at R2m and investments and movable assets valued at R1m) would attract executor’s fees of R119,700! As it is unlikely that you will be in a position to negotiate a fee from your grave, it is a good suggestion to pro-vide for a (lower) negotiated fee to be stipulated in your Will. This move could save your heirs thousands of Rands.

Planning for administration liabilities

Various liabilities arise in winding-up a deceased estate, and a planner’s failure to provide sufficient estate liquidity can cause hardship for heirs, as estate assets must be sold if the estate (or the heirs) cannot pay.

Some of these liabilities include: funeral costs, execu-tor’s fees, conveyancing fees, valuation fees, estate agent’s commission, estate duty, income tax and Capital gains tax.

Foreign assets

You should ensure that your Will deals adequately with any foreign assets you may own.

Married heirs

You can protect your heirs’ inheritances from being claimed by spouses in the event of a future divorce.

Family trusts

If you have an existing inter vivos (family) trust, you may wish to nominate your succeeding trustee in the event of your death.

Better late than never!