With National Wills Week that recently took place, South Africans were reminded of the importance of having a valid and updated Last Will and Testament. What are the implications of not having a Will, and what are the important considerations to bear in mind when having your testament drafted?
The COVID-19 pandemic has claimed millions of lives since last year, leaving many families to deal with losing loved ones unexpectedly. Unforeseen circumstances, like these, are exactly why each individual should have an updated Last Will and Testament which ensures that loved ones are taken care of.
What happens if you don’t have a Will?
If you pass away without a valid Will, your assets will be divided according to a set formula by the Intestate Succession Act of 1987. According to this formula, relatives based on nearest in degree will inherit your estate. Therefore, the myth believed by many that your estate goes to the State if you pass away without a Will, is untrue. Only if you have no beneficiaries at all, your estate will devolve upon the Guardian’s Fund and only if unclaimed for 30 years, it will be forfeited to the State.
Requirements for a valid Will
The following requirements are necessary to validate a Will:
- Any person over the age of 16 is entitled to a Will.
- Any Will that is in writing, handwritten or typed, is valid as long as the person who wrote/typed the Will is not mentioned as a beneficiary in the Will.
- Each page of the Will must be signed by the testator, as well as two competent witnesses. Witnesses should be 14 years or older to be considered competent, and it is best practice that witnesses are not nominated as an executor, administrator, trustee, beneficiary, or guardian.
- It is also best to date the Will to avoid confusion in case another version of the Will is located.
Choosing an executor
An executor is nominated to handle the administration and management of the deceased’s estate. Most individuals choose a family member or close friend as executor to their Will to ensure trust and that their wishes, such as burial preferences or nomination of guardians for minor children, are carried out after their passing. However, the process requires sufficient expertise to ensure that legislative requirements are met. It should also be carefully considered whether the nominated executor will be able to manage the estate during an emotional time.
It is therefore advised that the executor appoints a qualified attorney who specialises in deceased estates to assist with the process. This will ensure that the executor is guided by focused expertise and to alleviate the pressure of dealing with such a sensitive and time-consuming matter.
Retirement benefits are excluded from a Will
It is important to note that your Will does not determine the distribution of your retirement fund benefits. This is a separate process and bypasses any instructions in your testament. According to Section 37C of the Pension Funds Act, the retirement fund trustees will ensure that your dependants are financially taken care of before considering the beneficiaries indicated on the nomination form.
If you have not completed a beneficiary nomination form for your retirement fund, the benefit will be paid to your estate. As a result, your loved ones will not have immediate access to the payout and it will incur estate duty fees. It is therefore advisable to ensure beneficiaries are listed for your retirement fund benefits, so that the money is paid directly to them.
When to update your Will
Your Will should be kept up to date according to the changes in your life, such as when you have children or get divorced, to ensure the appropriate individuals benefit from your estate. It is also important to discuss with an expert how and if your assets should be specified in your Will. For example, if specific jewellery items are intended for a particular family member, should this rather be enclosed as an addendum to your Will to avoid increasing the value of your estate and therefore estate tax fees?
If you would like your Last Will and Testament drafted or if you already have one in place but would like to revise it, contact WMD for this value added service they offer all of their clients.