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There is a great misconception that only the rich and wealthy can have a will or partake in estate planning. This is far from true. If you have loved ones to care for and you own something, estate planning is necessary to ensure that they are cared for even after you are gone.

What is estate planning?

Estate planning by definition is “the process of making plans for the management and transfer of your estate should you become incapacitates and after your death.”  Simply put, it is putting in place a document, a will, that states how you want your estate to be administrated, by who, and to whom you want your assets to be given. The main purpose of estate planning is to ensure that you are taken care of should you be unable to do so, and that your beneficiaries are protected even when you are no longer there to do so.

Estate planning also secures that your estate is administered efficiently and closest to the way you would like it to be, eliminates the uncertainties that come with interstate succession (where no will is in place) and inheritance disputes, reduces the time it takes for your estate to be administered, and subsequently how soon your beneficiaries can benefit from your estate, as well as ensures that your estate has the liquidity required to settle your debts.

It must be noted that with interstate succession, 50% of your assets devolve to your spouse, while the remaining 50% goes to your children. Therefore if you have parents and siblings that you are taking care of, in the event of your death, these members will not receive anything from your estate. And this process can be lengthy and tedious.

The benefit of estate planning is that it is not only put into action after you are deceased, you can also ascertain the running of your estate in the event that you are incapacitated (e.g.  due to health reasons), and require assistance with regards to how your health care  should be conducted in your old age.

What is a will?

A will is simply a document drafted to stipulate what assets you have, how you want those assets to be distributed and to which beneficiaries. This is done once all your estate liabilities have been paid. Anyone over the age of 16 can draft a will, and it can include anything and everything that belongs to you, from your properties to your car, furniture and even your clothes.

The great thing about a will is that it can be amended as and when your life situations change, and you can add and remove assets and change beneficiaries as your life progresses. It is therefore important to keep it up to date.

A will does not only determine how your estate is distributed, it allows you to also state who you want to take care of your children as a guardian, who manages the money you leave for your beneficiary and how they do so, who receives your shares if you have shares in a business and, even how you would like to be buried.

As Warren Buffet said “Someone’s sitting under a tree today because someone planted a tree”

A will becomes that seed that you plant to ensure that your beneficiaries are taken care of.

Letting go of the myth.

As mentioned in the opening, it is untrue that you need to be wealthy to plan your estate. It is shown that vulnerable family members in less financially affluent homes benefit from estate planning in that even with the little that is there, a well administered estate secures that the beneficiaries receive support from the estate. A house worth less than R250 000, is still a home to your remaining loved ones. While the wealthy might need their money to be taken care of, middle- and lower-income individuals have families. Having a bank account is enough to have an estate, regardless of how much is in it.

Estate planning enables you to appoint a trusted person to execute and administer your estate no matter what your financial status.

Get a professional to help you.

Although you can draft your will by yourself, and there are plenty of DIY software’s that allow you to have one drafted, it is advisable that you appoint a professional to assist you. With changes that take place in life such as acquiring new assets like a house, getting married, and having children, changes in job status etc. having a professional who can regularly remind, monitor, and update your estate plan is beneficial. In addition, a poorly drafted will can run the risk of not meeting legal requirements, which then makes it invalid, may be ambiguous and hard to understand, and may have litigation implications for your beneficiaries and future.

Seeking advice from a specialist such as a lawyer may have cost implications, but it is more beneficial in the long run. A good lawyer can help not only with the drafting of your will, which may cost more, but  also assist you to review one that you have drawn up to ensure that it is compliant.

“Planning is bringing the future into the present so that you can do something about it now.” -Alan Lakein.

In as much as the future in itself is not guaranteed, you can do the most to guarantee that your loved ones are cared for in future.