It is only human to want to savour life; thinking about what to do with the time you have, and planning holidays and get-togethers with the people you love. However, having a Will and planning your estate properly will have an equally large impact on the lives of your loved ones.
What is a Will?
A Will is a document that contains the information for the distribution of your assets. In a Will, you may state your heirs and further wishes of the distribution of your estate upon your death.
Is it important to keep your Will up to date?
Yes, for with time, your wishes for certain assets may change. Furthermore, new heirs may be added to your Will. In the case of the death of an heir, you may have to choose a different heir for the assets. The assets that the heir would’ve inherited from your estate.
How often should you update your Will?
A good rule of thumb to re-adjust your Will is to have a look at it whenever you enter a new stage in life. Getting married, having children, having adult children etc. may all have a different influence on your wishes for your assets. The more you update your will the better.
Who can draft a Will?
Any person over the age of sixteen can draft a Will.
What is estate planning?
A properly structured Estate Plan will ensure that your family is taken care of after your death. Planning is the structuring and management of your assets so that when you pass away, your estate will be distributed fairly and securely to your beneficiaries.
What makes estate planning so important is that it also takes care of any taxes or costs that may go along with your death. Furthermore, estate planning ensures the protection of your assets for the benefit of your heirs, especially in the case of minors and any other special cases.
What is the difference between a Will and estate planning?
Estate Planning and the drafting of a Will go hand-in-hand. Generally, you will start the process by doing a comprehensive Estate Planning and then wrap it up by drafting a well worded Will.
The Will is a document that contains the bequests of your various assets and the heirs that will inherit it. Furthermore, the Will appoints an executor, who must ensure the proper administration of your estate according to your Estate Plan.
Your Will is just a small part of your comprehensive Estate Plan. The Estate Plan addresses various aspects of your estate while you are alive and after your demise. These can vary from a power of attorney which is only valid while you are able to recall is, to making medical decisions on your behalf before your death. All of these documents form part of your Estate Plan.
Why is it important that a lawyer should draft my Will?
Having a lawyer draft these documents, and assist in your Estate Planning process, can have numerous benefits:
1. You are ensured of a legal document that abides by the law and provides for all the necessary elements you may miss on your own.
2. The execution of your Estate will be much quicker because the distribution of your Estate and wealth cannot be disputed.
3. Your family will be taken care of.
What are the components of Estate Planning?
As we have discussed before, there are various documents that form part of a comprehensive Estate Plan. The following components should be include in your Estate Plan:
Last Will And Testament
Your Will is the document that states who the heirs are of your assets.
If the Will is invalid, or there is no Will, then the Law on Intestate Succession will determine how your assets will be distributed.
Power of Attorney
No person is by nature able to act on behalf of another – he or she must have the necessary authority to do so. This authorisation is commonly given in the form of a power of attorney. A power of attorney is a formal document by which a person (“the principal”) empowers/authorises another (“the agent”) to conclude juristic acts on his or her behalf. A juristic act is an act whereby legal relationships are created and which has legal consequences, for example entering into an agreement.
In order for the power of attorney to be valid, the principal must have the necessary contractual capacity. Within South Africa, the law of agency is based upon the principle that an agent cannot do that which his principal has no capacity to do himself. In other words, one cannot authorize someone else to perform acts that you yourself do not have the capacity to perform.
Therefore, a person who cannot understand the nature and consequences of granting a power of attorney cannot validly execute such a power of attorney.
Medical Directives
The enduring power of attorney (remains in force despite the mental incapacity of the principal) used in countries such as the UK, Canada, New Zealand and Australia is not known and used in South Africa.
At best, one can draft a Living Will in which your wishes are expressed regarding your medical state. Especially where you are not able to make any decisions about continued medication or medical care to keep you alive.
Beneficiaries
There is a lot of planning and decision making involved around Estate Planning. Thinking about your death is not always pleasant. However, you owe it to yourself, your legacy, and to your family to have a comprehensive plan in place. Especially in case of your untimely death.
Do you have a comprehensive Estate Plan in place? Get it done with our skilled and experienced team at Crest Trust!
info@ctrust.co.za