A Will – Priority for everybody’s To-Do List
Drafting a will is not at the top of everybody’s priority list, and soon, one forgets to draft this important document. Should one die without a valid will, their estate would be administered in accordance with the Intestate Succession Act, regardless of their last wishes and the provision they would’ve wanted to make for their minor children.
More than 70% of all South Africans die annually without a valid will according to the Master’s Office and the majority thereof are younger persons.
If parents of minor children pass away without making provisions for their children, it will result in their inheritance being sent to the Guardians Fund for safekeeping. This fund is managed by the Minister of Justice. Minors do not have the necessary capacity to engage in contractual agreements. Once the minor attains the age of majority (18), they would be able to claim their inheritance, as well as all interest accrued during this period.
The Guardian Fund may be an effective way to safeguard the minor’s inheritance, however, a testamentary trust should be considered as an alternative.
A testamentary trust is registered at the Master of the High Court and is administered for the benefit of certain persons (i.e., the minor beneficiaries).
A testamentary trust is provided for as a clause in a will or testament, wherein the parents of the minors can clearly set out the terms and conditions of the trust itself.
Parents can choose which assets are to be included in the trust for the benefit of their children (i.e. the beneficiaries), who the trustees should be, as well as the age at which the inheritance should be paid out to the children.
When the decision is made as to who the trustees should be, it is important to consider who will act in the best interest of the children. It is recommended to appoint a trustworthy person in addition to an independent person. Together, they will make the necessary decisions regarding the trust, and management of the trust assets. It is furthermore in the parents’ discretion should they wish to appoint the children’s guardian as an additional trustee.
Although you have the freedom to nominate any person to act as a trustee, the Master of the High Court has the discretion to choose whether to appoint that person or not. When making this decision, the Master will consider whether the trustees will act in the best interest of the beneficiaries.
All assets in the trust can be utilized for meeting the minor’s basic needs, maintenance, tuition, and so forth.
It is therefore of the utmost importance to consider all the necessary factors and to consider the future care of your minor children when drafting your will. You are encouraged to make an informed decision regarding your children’s inheritance, to safeguard it, until they can do so themselves.
Article by Zancha Kruger (LLB)
For more information, Zancha can be contacted at zancha@rgprok.com or 044 601 9900. www.rgprok.com
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Disclaimer
Nothing contained in this publication is to be considered as the rendering of legal advice for specific cases, and readers are responsible for obtaining such advice from their own legal counsel. This publication is intended for educational and informational purposes only.
