Because you care, estate planning is a must

11 September 2017 , Johnny Davis 671

"I recently spent days planning a perfect beach holiday for our family and it got me thinking about how much time I spend on planning for events in the near future, but barely give any thought to 'one day' and what will become of all the assets I have accumulated and will still accumulate during my life time, should something happen to me. I find the thought of estate planning quite overwhelming though. Is it really that important that I address it?"

A person’s estate consists of all the assets and liabilities accumulated during his/her lifetime, and which will be left behind in the event of their death. Thus, estate planning can be defined by its purpose which is to protect and increase an individual’s assets, ensuring the effective and beneficial distribution thereof and at the same time limiting the liabilities of their estate.

The secret to estate planning is knowing that it is never too early or too late to start. Whether you are a financially independent individual or just starting out with your career, the importance of estate planning applies to all. To explain the importance of estate planning, we have identified five reasons why estate planning should play a crucial part in your long-term plans:


1.	No one knows what the future holds – Whether it is tomorrow or thirty years from now, at some point we will find ourselves in a position where we can’t attend to our own affairs. Without an estate plan in place, the questions of “Who will attend to my affairs if I’m not capable?” and “What will happen to all my assets should I pass?” may cause sleepless nights. It is therefore of great importance to implement an estate plan groomed to your needs and ensure that the plan is regularly reviewed by capable individuals.
2.	Appointing those you trust – Whether it is to manage your affairs or even to identify the persons to be the guardians of your children, we can all agree these are decision you would like to make yourself, and not leave it in the hands of someone appointed by the court. This ensures that dependants are adequately provided for during an estate planner’s lifetime, as well as after his/her death and also saves your loved ones from making difficult decisions in the event of your passing.
3.	Benefit the taxman or those you love – From the first salary cheque you receive, most of us become acquainted with the idea of paying taxes. Unfortunately, on the date of your passing SARS takes its last share of your estate, commonly known as estate duty. Estate duty is currently levied at 20% and can thus be quite a substantial amount. Having a good estate plan in place might limit this amount and increase the funds and assets available for distribution to your beneficiaries.
4.	Making sure the right individuals benefit – This brings us to an important part of estate planning, namely the drafting of a final will and testament. Should you pass away without a valid will in place, your estate will be administered in terms of the intestate succession legislation of South Africa. This means that you have no say in who benefits from your estate, and it might cause the ones you love to walk away empty handed. Also appointing a trustworthy executor will give you the peace of mind knowing that your estate will be distributed in terms of your wishes.
5.	Saving time – Having a well thought out estate plan in place can save your family a long and complicated administration process in the event of your passing.

It is clear that estate planning is a complicated exercise, and none of the above mentioned areas are ones you want to leave up in the air. By working with professional estate planning attorneys, you can ensure you have addressed everything and most importantly, made sure your family or loved ones are taken care of.

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