ESTATE PLANNING: PART 3

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TIPS AND TRICKS

In Part One, I touched on the importance of proper housekeeping. Apart from the need to ensure that your will is in a safe place (and losing the original will can pose serious problems, since the Master is bound not to accept copies), there is further information which will considerably assist those close to you, both in the event of your death or incapacity.

This would include:

• A list detailing, for example, your computer password/s, where spare keys are kept, and PIN numbers. Needless to say, you should be particularly careful when recording sensitive or confidential information that such information doesn’t fall into the wrong hands.
• An inventory reflecting full details concerning your bank account numbers, unit trust details, policy numbers and the like. I generally suggest to clients that they compile such a list and that this be filed in securities with their will. This obviously also serves to considerably assist your executor in establishing the nature of your investments and where they can be found.
• Ensuring that your important documents are kept together (ideally) and that they can be easily located. Such documents would include, for example, share certificates and title deeds or certificates of registered title in respect of fixed or immovable property.
• To be safe, and since fires and unexpected hazards could destroy your vital documents, consider keeping certified copies of each in a separate location.

Tip 1: Surprisingly, when asked for title deeds, many of our clients are unable to locate them! More often than not, however, they lie in a bank vault as security for a mortgage loan. Very often, the loan amount has long been settled by client, but unless you specifically request this important document back, expect the bank to hold onto it until you do. Bond cancellation fees are minimal, so don’t let that put you off.

Tip 2: If you have long term insurance policies, be sure that you have nominated beneficiaries for policies held. The benefits of doing so are that the policy proceeds will fall outside your estate, thereby reducing executor’s commission, and that the beneficiary will receive payment a great deal quicker directly from the insurer concerned. Unfortunately, however, taking this step will unfortunately not reduce your estate’s exposure to potential payment of estate duty, since policy proceeds are considered to be a deemed asset.

A LIVING WILL

A so-called ‘living will’ is not to be confused with a conventional will, nor does it constitute consent to euthanasia, which remains unlawful in South Africa. A living will is simply the expression of a wish by a person who has testamentary capacity that should they enjoy no further quality of life, or have become dependent upon artificial means (such as life support) for his/her continued existence, such support may be terminated. Importantly, this is not a decision which family members can make without endorsement from suitably qualified medical personnel, but the living will goes to show that the signatory to it supports any such decision.

Self-evidently, this could also result in the saving of considerable, and unnecessary, medical costs, thereby diluting the benefits due to beneficiaries. If you would like a living will, consider having one drafted for you for signature by you at the same time you sign your will. The cost of a living will should be fairly nominal.

In part 4, I will deal with the various options open to you when considering how you would like to structure the benefits flowing to beneficiaries under your will. It is of concern to some that should they, for example, leave their entire estate to their spouse, he/she may later be duped into parting with your jointly hard earned assets. There are various options open to you to ensure that your estate goes to those whom you would like it to.

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