ACCORDING TO Sanlam research, only 46% of women have wills – nearly 20% less than men (63%).
This is a cause for concern because 42% of South African households are headed by women.
National Wills Week provides the perfect opportunity for women across the country to empower themselves and safeguard their legacies.
Moremadi Mabule, Head of Wills Operations at Sanlam Trust, says, “It is concerning that so many women are not exercising their right to choose who inherits from their estate, known as freedom of testation. Due to structural inequalities, women are playing catch-up when it comes to controlling their finances. This trend will change as more women take control of their financial destinies.”
Why You Need A Will:
Nearly half (45%) of people who don’t have a will, believe they don’t own enough assets to warrant estate planning. According to Mabule, this is a misconception that can have grave consequences.
She says, “Everyone has some form of an asset and having a will in place goes a long way toward helping those who depend on you to live confidently. This doesn’t only include big things like a car or a house, it should also include jewellery, investments and sentimental items – even digital assets such as photos in the cloud and cryptocurrency.
For parents, your will should also provide for guardianship of your children and a plan to care for your pets. Estate planning gives you peace of mind knowing that your intended beneficiaries will inherit and avoid unnecessary turmoil during an already difficult time for your loved ones.”
Some of the human factors preventing people from drafting a will include anxiety over ‘who inherits what’ and a tendency to avoid talking about or planning for when we are not around.
“45% of people admitted that they just hadn’t got around to it. If estate planning is not common practice with close friends and family, it may not be considered something to worry about and we’re less likely to prioritise it,” adds Mabule.
Keep Your Will Current:
One woman’s family discovered just how important it is to update one’s will after a major life event.
In 2009 the mother signed a will that left 40% to each of her children and 20% to her boyfriend at the time. In 2018 she married her boyfriend in community of property (COP) but did not update her will. When she passed, her boyfriend (now husband) was entitled to 50% of their joint estate while her children could only inherit from her share of the estate.
What To Consider When Drafting Your Will:
There are several factors to consider when drawing up a will, including one’s marriage regime.
Being married in COP or having a joint will have major implications on how your estate is dissolved.
Mabule says, “When couples get married in COP, they create what is called a joint estate. This means that the instructions they set out within the will deals with half of the joint estate. It also means that half of the joint estate will belong to the surviving spouse. These are important things to consider when weighing up how to divide your estate.”
Other things to keep in mind:
• Make sure your instructions can be executed. For example, you cannot leave your share of a car to someone.
• Drafting a single will helps you retain control of your legacy and ensure your instructions are carried out as you intend.
• As an entrepreneur, having a will in place is a vital part of business succession planning and can help avert potential disasters, such as leaving the running of a business to minors and/or unqualified persons.
• For parents of children with serious disabilities, estate planning is critical as they may never be able to work and provide for themselves.
• Sanlam Trust found that over 46% of deceased estates it administers have insufficient cash to cover all debts, taxes and estate duties.
This includes the cost to transfer a property to an heir. Insufficient liquidity can erode the inheritance of those left behind as a cash shortfall often means that assets of the estate must be sold to increase liquidity. Sanlam Trust offers an Estate Expenses benefit which will contribute to covering the estate expenses and taxes. Alternatively, a dedicated life insurance policy can significantly contribute to ensuring sufficient cash flow.
How To Draft A Will:
Drafting a will can be a relatively easy and inexpensive process depending on your circumstances, and this makes it more inclusive and accessible to those struggling financially. If you have fairly straightforward requirements, you can complete a will application form, prepare a list of assets and liabilities, and write up instructions on what must happen to your estate with the details of beneficiaries. These wills can be prepared for free online via the Sanlam website.
Mabule says, “This is perfect for married couples who are leaving their respective estates to each other and people who would like to leave everything to their young children.” For more complex wills it is advisable to seek advice from a financial adviser.
Mabule concludes, “At Sanlam Trust we believe that proper estate planning, which includes the creation of a will, gives women the power to control a critical element of their financial destiny regardless of their financial status or the size of their estate.
This can ensure that their beneficiaries are adequately protected, providing a springboard for future generations to live with confidence.”
