Where There’s a Will

Where There’s a Will


Conflicts easily arise amongst heirs when there is either no will, or a badly drafted one. Feuds between family members may continue from one generation to the next, and could have been avoided by clearly stating how the estate should be apportioned. It amazes me how many people neglect this vital document.

Review your will

Where there is a well thought out will it ensures that your family is correctly provided for in the event of your death. If you die without a will (‘intestate’) it is left up to the law to determine who will inherit, usually based on the law of succession. Spouses will inherit from each other, then children and lastly parents before all the other relatives come into the reckoning.
Your will should be revised regularly, even if your circumstances remain the same. It is a good idea to review your will at the same time as you review your overall financial position, but there are other opportunities to do so:

  • Definitely at the birth of a first child, as well as future additions to your family
  • When children become independent
  • At the loss of a spouse
  • At the sale of a business
  • When a family member becomes disabled
  • When there are any changes in your financial position.

Those who applied for amnesty on their offshore assets and where these assets are held in their own name, need to ensure that their wills deal with their worldwide assets. If you have both a South African and an offshore will you need to ensure that the two are in sync.

Clear instructions

Children under the age of 18 cannot inherit directly if they are the beneficiaries of an estate following the death of both parents or a single parent. Without wills their inheritances may be paid into the guardian’s fund, which is administered by the master of the high court. This is not a desirable solution, and is made even more complicated when one child may need extra money and care. Some of the benefits of a well-constructed will are:

  • Clarity about who is being left which asset as assets can be left to quite a few different people
  • The protection of assets left in a testamentary trust — while I am not suggesting one should rule from the grave, thought should be given to ensuring funds are not being misused
  • Provision for donations to charities
  • Rewards for loyal staff who may no longer be required
  • The ability to leave to specific heirs items such as jewellery, antiques, paintings and other valuables as you wish (which will avoid squabbles within the family). Many breadwinners are concerned that if they leave all their assets to their surviving spouse, if the spouse remarries the new partner will get their hands on those assets.

Avoid assumptions

As previously written, by leaving assets to a trust, the assumption is that the spouse will be looked after. That is often not the case, since trustees are concerned that they have to retain the capital for the ultimate beneficiary, the children. With inflation, low interest rates and poor investment returns, this income is often not adequate. The trust will provide for trustees to make capital distributions to the spouse, but they will always be watching how this will affect the capital.
A simple way is to provide ‘mini capital’ for the surviving spouse and the children, by appointing them beneficiaries of life policies. In this way, the spouse will receive a cash lump sum for his or her own use. The children do not have to wait for their living parent to die before they receive the funds left to them in the trust, since they now have their own capital. Finally, in drafting a will it’s critical that you choose both the right executor and trustees. n

Bryan Hirsch
BRYAN HIRSCH has been in the financial services industry for 47 years and is a director of Bryan Hirsch Colley & Associates. He has written two books, the first Bryan Hirsch’s Guide to Personal Finance and more recently, Steps to Financial Freedom. Bryan has written for many of South Africa’s top financial and business publications, has been a weekly guest on Radio SAFM for 18 years, and has his own weekly TV show You & Your Money on Summit TV.