The advantages of having a will
31 Aug 2011
Most of us work hard and act prudently to build up and protect our estate. We want to enjoy the benefits of our labour and ultimately, provide for our dependants. To achieve this, we conclude many contracts and sign numerous documents.
It seems foolhardy to undo all that good by not having a personalised Will, which will give protection and welfare to our dependants and family when we die.
The Intestate Succession Act caters for those who die without a Will. But it is, at best, a second prize. We are all unique; our circumstances differ and a one-size-fits-all formula cannot adequately address our individual requirements.
In South Africa, unlike other jurisdictions, we enjoy the privilege of freedom of testation. This allows us to choose how and to whom we wish to bestow our estate after we die. There are some minor restrictions in that the directions of the Will may not achieve unlawful consequences and are not contrary to prevailing norms of society.
The only real restriction is that a testator cannot leave his children or surviving spouse without maintenance if they have insufficient means themselves.
Fortunately, unlike the Romans of a bygone era, you cannot “inherit” someone’s liabilities if these exceed their assets.
LET’S HAVE A LOOK AT SOME OF THE MAJOR ADVANTAGES OF A WILL
As the testator of your own will, you have many advantages:
You can select your beneficiaries, taking into account the nature and size of your estate and your family’s needs. You need not limit your selection to family: you are free to acknowledge people and causes of your choosing. And you can exclude someone.
You can decide which assets and what percentage or value of your assets to leave to various beneficiaries. You may want to bequeath specific items and amounts to different beneficiaries. If, on the other hand, you die intestate, your beneficiaries will be entitled only to a fixed and equal proportion of your estate.
You can nominate an alternative beneficiary if for some reason the first nominated beneficiary cannot inherit. For example, if the nominated beneficiary dies before you.
You can choose to place conditions on a beneficiary before they qualify to enjoy the benefit, and how they may or may not use the benefits of their inheritance. A common restriction is to exclude the spouse of a beneficiary from any matrimonial claim on the inheritance.
You can decide what will happen if a beneficiary should become incapable of dealing with the inheritance and how the ultimate beneficiaries can be protected. You can use mechanisms such as limited interest and a testamentary trust to protect minor children or incapacitated beneficiaries.
You can ensure that the scheme of your Will is in line with your other estate planning tools. Common examples are ante-nuptial contracts and inter vivos trusts, and benefits flowing from sources traditionally outside the estate like retirement annuities, pension funds and life policies, or other assets, such as offshore interest.
You are able to choose who will be the executor of your estate. And you can determine the powers the executor will have, and if you want the executor to provide security.
You can employ estate duty savings and other protection mechanisms, which would be lost if you have no Will.
You can nominate a guardian to care for your children in the unfortunate event that you should die while they are still minors.
Having a well-crafted Will available at the time of your death will help to speed up the administration process and will limit any potential disputes and conflicts.
In many ways, a Will is the most important legal document there is. Without a Will, a lifetime’s work could be undermined and your otherwise carefully constructed commercial and legal safeguards could be negated. What’s more, your dependants, family and beneficiaries are likely to suffer the hardship of an uncertain financial and legal future because of the inevitably long delay in winding up your estate.(This article is provided for informational purposes only and not for the purpose of providing legal advice. For more information on the topic, please contact the author/s or the relevant provider.)