Wills, trusts, life insurance – we’re explaining why they’re all important to protect the people you love.
Here’s an alarming stat – only 15% of South Africans have a Will. We think that if more people were aware of why it’s so important to create one, this would change. Still, estate planning doesn’t just stop there. You could also consider creating a trust or investing in a life insurance policy and, once we explain the benefits, we hope you’ll realise why estate planning is one of the best things you can do to protect your family’s financial future.
Why you really want a Will
In South Africa, if you pass away without a Will, your assets will be distributed according to the Interstate Succession Act in a way that might not align with your wishes. In short, you’ll have no say in who gets what. Worse than that, if you don’t have a Will, you can’t appoint an executor (someone you trust to ensure your wishes are carried out), so the court will decide that for you. This process can take years to complete and, in the meantime, your assets will remain frozen, potentially leaving your family with bills to pay and no access to your funds for an extended period of time. Scary stuff, but this can all be avoided with a Will, so why not create one with MiWill today?
Having a Will is a must, but you might also benefit from creating a trust, depending on your circumstances. Unlike a Will that only comes into effect after your passing, a trust is a separate legal entity that can be created during your lifetime. After funding it by transferring your assets into the name of the trust, the trust is then controlled by a designated trustee who manages it on your behalf.
The benefits of having a trust include tax breaks (depending on the type of trust), the protection of assets from creditors and being able to ensure the responsible distribution of its assets. If you have a large estate and want to pay less tax; are worried about debt collectors or worry that your beneficiaries won’t have the financial savvy to best manage their inheritance after you pass away, a trust could be a great financial tool.
If I have a Will do I still need life insurance?
We think so! Life insurance serves as a brilliant financial safeguard for your loved ones. You’ll pay a monthly premium and, in the event of your passing, it pays out a lump sum of your choosing to your beneficiaries. As this payout comes from your life insurance policy, not the assets you’ve listed in your Will, your loved ones will receive your cover amount as a tax-free payout even if you had to pass away with no money in the bank. Also, If the claim is straightforward, your family should receive the payout within weeks, not years as would be the case if you didn’t have a Will. This way, they can take care of daily bills and even afford to realise big financial goals, such as paying off your bond.
Ultimately, estate planning is important as it empowers you to choose how your wealth is passed on as well as protect your family’s financial future, so don’t leave it until later. Make it a priority today so you can enjoy tomorrow with more peace of mind.
Did You Know:
You can now take out life cover with us online in a few simple steps. No calls and no agents! Make sure to take care of those you love today by buying MiWayLife cover online.
