Four things you need to consider to protect your financial legacy

People need to consult with a financial adviser when drawing up their will so they can ensure that their loved ones are taken care of. Picture: Freepik

People need to consult with a financial adviser when drawing up their will so they can ensure that their loved ones are taken care of. Picture: Freepik

Published Feb 5, 2024


It is important that people take the time to understand how their financial journey benefits their family and the loved ones that depend on them.

To do this people need to ask themselves these three questions:

1. Do I have a will?

2. Is my will up to date?

3. Is my will valid?

Thirty-five percent of wills end up being ineffective because the deceased's estate falls short of meeting its desired intentions. This leaves grieving loved ones without their intended inheritance.

According to Ulanda Weilbach, head of Financial Planning and Advice from Momentum Financial Planning, the responsibility of securing the financial future for your loved ones is entirely yours.

A trustworthy financial adviser understands the critical importance of a will outlines your wishes and has provisions to ensure that the winding up of your estate is done in an orderly fashion.

Such a document becomes a crucial element in a comprehensive financial plan, providing the emotional support that a family needs during a time of profound sadness. It's a reminder that proactive estate planning is not just about assets, but also about safeguarding the wellbeing of those you hold dear.

Here are four things that you need to know about wills and estate planning:

A legal, executable will is the foundation

While South Africans might think of a will as a means to secure the future distribution of their assets, according to Weilbach, a will should be seen as the foundation of a more comprehensive financial plan.

A will sets out the distribution of a person’s estate and providing clarity and legal validity to your wishes. People need to ensure that your will is legally valid and is applicable to your current financial situation as well as obligations.

Advice for success

To get onto the path of success people should consult with a financial adviser. A financial adviser play a crucial role in developing a holistic plan.

A financial adviser can:

– assess your financial situation

– offer expertise in financial planning, and

– provide insights into strategies tailored to your unique circumstance

The cost of winding up your estate

South Africans need to consider the practicalities and costs associated with winding up an estate. The costs related to winding up an estate can be substantial, from legal fees to administrative expenses.

People need to ensure that their financial plan has provisions for covering these expenses.

“Advisers can assist in developing strategies to ensure the seamless and cost-effective winding up of your estate,” Weilbach said.

The challenges of wrapping up an estate

There are a few challenges that one may face when trying to wrap up an estate without the help of a professional, these include:

– A will that cannot be found, is not signed, or witnessed correctly can cause a great deal of confusion and added stress for your loved ones. An incorrectly signed or witnessed will can be declared invalid and your estate will be divided according to the laws of intestate succession.

– In certain cases where the estates is less than R250,000 in value, the family will have to deal with the Master directly, as it will be too expensive to appoint a professional executor.

– If you have not provided for liquidity issues like cash shortfalls or there is insufficient cash available to settle estate winding up fees and debt before you died, your loved ones will have to cover those costs.

– In the case of an insolvent estate with no provision made for settling debts upon your death, all your assets like your house and car will have to be sold to repay your debts before your loved ones can inherit anything.

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