Have a Little R.E.S.P.E.C.T for My Wishes
The Queen of Soul, Aretha Franklin, died in 2018. However, it took until 2023 for an American court to rule that a handwritten document from 2014 was her valid last will and testament.
Her children contested her will in court, disputing the validity of documents left by the late singer in 2010 and 2014, leading to disagreements over the division of her multimillion-dollar estate.
David Thomson, Senior Legal Adviser at Sanlam Trust, says this is a reminder that drafting and signing a will ensures your final wishes are respected, and could save your loved ones from long and potentially expensive legal disputes.
According to a recent Sanlam Legacy survey, 45% of people who don’t have a will, believe they don’t own enough assets to warrant estate planning – a total misconception. “While most of us will not leave behind a multimillion-dollar estate, everyone has some form of an asset and having a will in place goes a long way toward helping those who depend on you to live confidently,” explains Thomson. “This doesn’t only include big things like a vehicle or a property. It also includes your bank account and investments (however small), jewellery and sentimental items, as well as digital assets like photos in the cloud and cryptocurrency. For parents, your will should also provide for guardianship of your children and a plan to care for your pets. Estate planning gives you peace of mind knowing that your intended beneficiaries will inherit and avoid unnecessary turmoil during an already difficult time for your loved ones.”
Some of the human factors preventing people from drafting a will include procrastination, anxiety over ‘who inherits what’, and a tendency to avoid talking about or planning for when we are not around. “If estate planning is not common practice with close friends and family, it may not be considered something to worry about and we’re less likely to prioritise it. There is also a belief that creating a will is very expensive, but this is not the case,” adds Thomson.
One of the biggest factors to consider when drawing up a will is marriage regime. Being married in Community of Property (COP) has major implications in terms of how your estate is distributed.
“When couples get married in COP, they create what is called a ‘joint estate’. This means the instructions they set out in their wills deal with half of the joint estate. It also means that half of the joint estate will belong to the surviving spouse. It’s important to consider this when weighing up how to divide your estate,” Thomson explains.
- Drafting a will is worthwhile because it helps you retain control of your legacy and ensure your instructions are carried out according to your wishes
- Persons living together in a committed, long-term relationship should get their wills done. Failure to do so can result in the surviving partner being left with nothing
- It is critical for parents of children with special needs or serious disabilities to draft their wills and do careful estate planning as these dependants may never be able to work and provide for themselves
- For entrepreneurs, drafting a will is a vital part of business succession planning. It could avert potential disaster by avoiding leaving the running of a business to minors or unqualified persons.
- Make sure the instructions in your will can be practically executed. For example, it is impractical to leave a vehicle to more than one person.
- Sanlam Legacy has found that many deceased estates have insufficient funds to cover debts, taxes and estate duties. This includes the cost to transfer a property to an heir. Insufficient liquidity can erode the inheritance of those left behind as a cash shortfall often means assets of the estate must be sold to increase liquidity. Sanlam Legacy offers an Estate Expenses benefit which will contribute to covering the unexpected costs associated with dying. Alternatively, a dedicated life insurance policy can significantly contribute to ensuring sufficient cash flow.
A will gives you the final say in how your assets are distributed and your wishes carried out. Drafting your will can be a simple process, but it can also feel overwhelming.
“If your circumstances are straightforward, you can create a will using the free Sanlam online tool . This will is perfect for single persons or married couples who are leaving their respective estates to each other, and people who wish to leave everything to their young children,” explains Thomson.
If you have a more intricate estate and complex circumstances, it is best to consult a financial adviser or will consultant who can assist with an estate plan and drafting your will.
- The Wills Act dictates that everyone from the age of 16 can sign a will and there is no minimum asset base, so estate planning can begin early and evolve over your lifetime
- You can decide how your assets will be distributed, which means that you can provide for loved ones in the best way you see fit. It also means you can disinherit people who may otherwise stand to inherit.
- If you have minor children (under 18), you can decide who will take care of them
- Having a will can ensure that your loved ones avoid lengthy and expensive legal processes, especially when dealing with a less complex estate
- There will be no uncertainty about your last wishes and therefore less chance of family feuds