Your Will & Estate Plan

Let’s face it, it’s not an easy subject to broach, and planning for your death is intimidating and uncomfortable. But it is something you should prioritise for your loved ones’ sake. Death is inevitable, and its consequences affect your whole family, so it’s best to plan for those around you.

If you die without having a will in place, you leave important decisions up to the courts and the law of intestate succession

If you don’t have a valid will then you don’t have a say in who receives your property and other assets after your death. This means that someone you may never have wished to inherit might do so, while those who you genuinely care for and would want to benefit from might be left with no legal entitlement to your estate or assets.

Plus, not having a will can make it more difficult for your loved ones, both emotionally and financially at a time when the last thing they need is extra stress in their lives.

Your will is essentially a summary of your wishes regarding the distribution of your wealth and a framework to guide those charged with the winding up of your affairs. There are also many other benefits of having a will, such as the ability to appoint guardians for any minor children, keeping a helpful record of assets that surviving relatives might not be aware of, and limiting taxes payable on deceased estates to name but a few.

The importance of ensuring that your will is drawn up within the context of a comprehensive financial plan cannot be overemphasised

There are quite a number of statutory costs and other expenses involved in the winding up of an estate. It is therefore essential that your estate financial plan provides liquidity for such costs so as to avoid forced sales of estate assets, at a fraction of their true value, to cover costs.

These are some of the fees your family will need to cover when you pass away:

EXECUTOR FEES

These are the industry standard fees charged by the executor or assisting professional to wind up your estate. A maximum of 3.5% + VAT of your estate value may be charged. Example: An estate worth R3 million may pay R120 750 in fees.

CONVEYANCING ATTORNEY FEE

This is the fee charged by the conveyancing attorney when property needs to be transferred. Example: A home worth R1 850 000 being transferred to a beneficiary will cost R30 544 in fees to the estate.

TESTAMENTARY TRUST FEES

These are the fees charged by the trustees to administer the trust created in terms of your will, normally to look after the money you leave to your minor children. On average, 1.15% of the net asset value is charged to establish the trust, and 1.6% is charged annually for the ongoing administration of the trust. Example: The total cost with R1.5 million in assets over 15 years is R377 250.

MASTERS FEES

The fee paid to the Master of the High Court regarding the fulfillment of their role in the administration of your estate.

CORRESPONDENCE FEES

Fees associated with corresponding with the Master of the High Court.

CLEARANCE FEES

One of the requirements to transfer a property is obtaining a clearance certificate from the city council or municipality. This will be issued only if the rates and taxes are paid in advance. Some areas require up to 6 months paid in advance.

ADVERTISEMENT COSTS

Two advertisements have to be placed in a local newspaper and the Government Gazette. The costs can vary between R1 000 and R1 500 depending on the publication selected.

INHERITANCE TAX

Not only will all outstanding taxes have to be paid from the estate before it may be finalised, but the executor will have to determine whether capital gains tax (CGT) or estate duty is payable at death. In the event of off-shore assets, situs tax may be applicable.

ONGOING BILLS & OTHER EXPENSES

Bills such as medical aid, school fees, car insurance, water, lights, rates, etc. still need to be paid even though bank accounts are frozen. Costs associated with arranging a funeral such as catering, travel, and other expenses also need to be covered.

These taxes and fees eat away at the legacy you plan to leave behind. Specialised life assurance policies are now available to ensure that your estate has the liquidity required to meet all its financial obligations in the event of your death. Your financial adviser will be able to assist you with this or alternatively contact us at Rutherford on 021 870 1555 or This email address is being protected from spambots. You need JavaScript enabled to view it.

Apart from having a valid will in place in the first instance, it is vital to revise an existing will when significant events, such as marriage or the birth of children take place in your life, so that beneficiary details, in particular, are kept updated.

Source: Capital legacy