While one should review their estate plan annually, here are some key events which should ring a bell for an estate planner to revise their estate plan:
- The Wills Act states that except where expressly otherwise provided, a bequest to a divorced spouse will be deemed revoked if the testator dies within three months of the divorce. This provision is to allow a divorced person a period of three months to amend their Will, after the trauma of a divorce. Should he/she fail to amend their Will within three months after their divorce, the deemed revocation rule will fall away, and the divorced spouse will benefit as indicated in the Will.
- In addition, review beneficiary nominations on any policies, retirement annuities, and trust deed provisions (all subject to the divorce order).
- Sale or donation of asset specifically mentioned in Last Will and Testament or Inter vivos trust
- Birth of a child or grandchildren: If children are minors the estate planner needs to ensure that the assets they inherit are protected through his Will.
- Minor child reaching age of majority (18 years of age)
- Estate planner acquires significant property
- Downturn in estate planner’s financial position
- New business ownership: Provide for business succession planning in the partnership, shareholders or association agreement(s).
- Change in legislation having an impact on the estate plan. For example, annual Budget speech announcements and tax legislation amendments.
The estate planner will need to decide whether it is practical and viable to merely amend current documents or create entirely new documents to account for any changes.
Important notes to bear in mind
- A Last Will and Testament only deals with property in the deceased’s name at the time of his death.
- In regard to business interests, an association agreement between members of a Close Corporation, or a shareholder’s agreement in regard to a private company, may prescribe how a deceased’s interest should be dealt with.
- When a testator is married in community of property, they must remember that it is only half of the joint estate that they are able to bequeath in terms of their Last Will and Testament. The other half belongs to spouse in consequence of the marriage.
- Trust assets do not fall within the testator’s estate at death. Trust assets are dealt with in terms of the trust deed. Estate planners should not mistakenly believe that an asset held and owned in a discretionary trust will vest in beneficiaries upon the trust founder’s death.
- A badly worded Last Will and Testament may lead to unintended consequences, and even the disinheritance of a loved one that the testator did not intend to disinherit.
- The estate planner should also take note of making provision for their social media accounts - most social media platforms do have policies in place regarding the profiles of users who may have passed away. The estate planner should indicate their wishes regarding their social media accounts, to their next-of-kin.
- Careful consideration of all the principles and legal implications should be exercised by the estate planner and discussed with a professional adviser before taking any course of action.
Should you require professional advice in this regard please do not hesitate to contact our offices.