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4 Steps to a Smarter Will

There are things to consider when leaving your money to your minor children.

Hesta van der Westhuizen

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Most people with children have an almost standard clause in their wills that leaves their estate or a portion of it to their kids, at least in the event of the two parents dying at the same time.

But what are the consequences if the kids are still minor (younger than 18)?

1. Who will manage the money?

Money or other assets left to a minor child in a will could be managed on their behalf by the natural guardian, or surviving parent of the child – but only if they comply with the requirements of the Master of the High Court. These include authorisation by way of a “Letter of Tutorship or Custodianship” as well as the Master’s satisfaction that the money have been secured by the guardian on behalf of the child.

However, the following problems could arise:

  • The Master of the Court could refuse to grant the natural guardian or surviving parent the authority to manage the money on behalf of the child if they are concerned that the money will not be managed wisely.
  • The deceased parent might have had sole custody of the child after, for example, a divorce. In such a case the surviving parent does not automatically become the guardian of the child and has to go to court to get custody or guardianship of the child – and even then the Master of the High Court might refuse to grant the surviving parent the authority to manage the money left to the child on his or her behalf.
  • Both parents die at the same time and no other person has been appointed guardian of the child in the will.

If the money cannot go to the guardian, it will go to the Guardian’s Fund where it will be managed on behalf of the child by the government or Master of the Court.

Related: Stop Encouraging Ungrateful Brats

2. Insurance policy beneficiaries

Sometimes the parent makes the child the beneficiary of their insurance policies, which leaves the money to the child outside of the will. However, in such a case the insurance company will request a copy of the will to see who is going to manage the money on behalf of the child – as they are legally obliged to.

If there is no guardian appointed in the will or if the natural guardian cannot be identified, they might also choose to rather pay the money to the Guardian’s Fund.

3. Safeguard the money that you leave

Apart from the legal issues related to leaving money to a minor child, there are also other behavioural issues that could affect your inheritance to your child: what if the surviving parent is not good with managing money and the child’s inheritance gets squandered?

What if the surviving parent subsequently gets into a relationship with a person that you would rather not manage your child’s money?

Related: What to Do About that Inheritance

4. Specify the age at which they receive the money

A note of warning – you might have left your estate to your children, but on condition that they can only get their money when they achieve majority. However, your intention might have been for them to get the money when they turn 21, but as the age of majority has changed to 18, this could mean that your children are now inheriting the money at the age of 18.

The answer to how best to provide for the prudent management of your child’s inheritance will depend on your circumstances and family relations.

An option would be to set up a testamentary trust in your will with trustees that can do the job on your behalf. But if the management of a testamentary trust might be too costly to consider in your circumstances, there are a number of insurance companies offering umbrella type trusts that could be a cost-effective option.

Therefore, make sure your will is up to date and that you have appointed suitable guardians in your will to take custody of your children in the event of both parents dying at the same time. And of course, consult with a certified financial planner to check how you can best plan for any of the circumstances described above.

Hesta van der Westhuizen CFP is a Certified Financial Planner at Consolidated Financial Planning and has a BCom-degree and Advanced Post Graduate diploma in Financial Planning Law. She is also Chairperson of the Financial Planning Institute’s Risk committee. For more information please visit: www.consolidated.co.za

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Personal Finance

6 Ways To Develop A Millionaire Mindset

Chasing money has remarkably little to do with getting rich.

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If you truly want to have a million dollars, you must first be and think like a millionaire. By doing so, you will attract the necessary resources to you.

So, you want to become a millionaire entrepreneur? You’re not alone. Many dream of leaving their job and becoming their own boss, enjoying the various millionaire lifestyles we watch on TV. But there’s a difference between those who dream of becoming millionaires and those who do. And it begins and ends with mindset. If you don’t develop that mindset, you will continue to spin your wheels, working just as hard, but never going anywhere.

Developing a millionaire mindset requires you to stretch your thinking. Start by developing the following six attributes.

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Personal Finance

4 Ways To Become A Millionaire Even When You Start With Little

It costs nothing to take advantage of the limitless opportunities online.

Timothy Sykes

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The hardest part of becoming successful is getting started to begin with. But despite the challenges ahead of you, there’s a way to become a millionaire when starting with little. I’m going to show you four reasons why you can become a millionaire with just a small investment.

1. First focus on learning, not big gain

Education is your greatest weapon. Focus on learning in the beginning. Don’t make the mistake of focusing on making huge gains in the beginning. Learn everything you can because this is how you build the foundations for long-term gains.

Related: 21 Choices Millionaires Make That You Aren’t Making But Should Be

They say that if a millionaire goes bankrupt they’ll nearly always be able to get it back. And that’s because they might have lost their money, but they have the knowledge of how to get back to where they need to be.

2. You can learn loads about any topic online

online-learning

I’m grateful for the internet. It’s the single biggest library in the world. You’re reading this article right now and you’re acquiring knowledge you wouldn’t have been able to acquire 40 years ago.

Use the internet to its fullest extent, whether that’s through reading books, browsing articles or watching video tutorials. Set some time aside every day to learn something online. It could be a video series or a favorite blog.

When you get into the habit of learning regularly you’ll find that you advance much faster.

3. Focus on the niche you love

These days you can learn about anything and target the niche you’re passionate about.

This is what I was able to do with penny stocks. I found a gap in the market and provided knowledge to people who wouldn’t have otherwise being able to access this sort of information.

You can do that with absolutely any niche. When you find a niche you’re passionate about and you use the reach of the Internet you start to make huge gains.

4. Prove your expertise by creating free content

Your reputation as an authority is the new business card. There’s a reason I created a penny stock guide and made it free for all. You may have already seen ads for it on social media. The way to succeed with little is to create a reputation through your content.

Related: How To Become A Millionaire, Explained In 1 Minute

It’s the gateway to success because through free content you start to build relationships with others who value your work. And from there everyone gets richer.

You can do lots with a little

The days when you needed a huge investment to become successful are long gone. These days you can do so much with just a little. Find what you love, advance your knowledge in that area, and create a product that fulfills a need. Finally, work on building up relationships through portraying yourself as an authority on your subject.

Combine everything together and you can accomplish anything.

This article was originally posted here on Entrepreneur.com.


Related: 13 Habits Of Self-Made Millionaires You Could Adopt Today

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Personal Finance

10 Tips To Become A Millionaire This Year

Becoming a millionaire requires changing your mindset and implementing some changes.

Murray Newlands

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Becoming a millionaire may seem out of your reach, but it’s possible with the right attitude and guidance. The fact of the matter is your income can only grow as quickly as you do, so you need to change your mindset to achieve your goal of becoming a millionaire.

Once you have a millionaire mind, you can’t lose it, no matter what financial or business mistakes you make along the way. To get yourself there, you’re going to need some structure. To help you, I’ve outlined the top ten tips you should follow to become a millionaire this year.

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