Ulanda Weilbach, Senior Legal Adviser at Momentum Financial Planning

Estate planning is never straightforward, and as family structures evolve, complexity can arise. According to Ulanda Weilbach, Senior Legal Adviser at Momentum Financial Planning, as your family dynamics change over time, so too should your estate plan.

“If you plan correctly, all your beneficiaries will receive what you believe is fair. Without a proper plan or with an invalid Will, your family is going to need to rely on the letter of the law. This can lead to disputes, emotional turmoil and infighting.”

The role of the Intestate Succession Act

Without a valid Will, Weilbach says South Africa’s Intestate Succession Act comes into effect. This provides strict guidelines on how any estate should be divided. Weilbach says this can leave little room for personalised care or specific provisions for different family members.

In the unfortunate case where both natural parents pass away simultaneously, Weilbach says a Will becomes even more critical. Not only should a guardian be nominated, but there should be sufficient funds available in the estate to assist them in fulfilling that role. Legal processes can be lengthy and costly, which is doubly true when it involves minors.”

Testamentary trusts: A powerful tool for protection

A testamentary trust can serve as an essential tool for protecting children’s inheritance. With a trust, you can provide for each child individually, ensuring their share of the inheritance is managed and distributed according to their needs. Weilbach says this is especially important in cases where one parent wants to protect funds being paid to minor children as opposed to other individuals, including a spouse.

Testamentary trusts can also be structured to allow trustees to manage the inheritance until the child reaches a certain age. This not only protects the child but ensures their inheritance is used for their benefit as specified in the Will.

“Trustees will manage and distribute funds in a way that benefits the child, protecting them from beneficiaries who may not have their best interests at heart,” says Weilbach.

Guardianship: The key to parenting continuity

When parents draft a Will, “Who’s going to look after my child?” is one of the most pressing questions. This is where guardianship becomes a critical concern. Weilbach says a legally sound Will plays a crucial role in guiding the courts on who should be appointed as the guardian.

However, according to Weilbach nominating a guardian in the Will is only the first step. It’s equally important to ensure there are enough funds to support the guardian in fulfilling this role. “By making specific provisions for the guardian in the Will, families can ensure that the child is cared for without additional financial strain on the nominated guardian.”

Marital regimes and estate planning

When it comes to marriage in South Africa, in community of property is the default regime. If a couple has not entered into an antenuptial contract (ANC), they are automatically married in community of property. Weilbach says this means that, unless explicitly excluded in the Will, a spouse’s inheritance may fall into the communal estate, implying that half of the estate belongs to the spouse.

“This legal roadblock can become tricky when biological and stepchildren are involved,” warns Weilbach. “If the inheritance is not carefully structured, it could lead to tension between individuals, resulting in unintended legal procedures.”

There’s no substitute for the right advice

Estate planning for families not only demands attention to detail but expert guidance. Families, big or small, all have unique needs, and ensuring that family members are adequately cared for can be overwhelming without the right knowledge. That’s why Weilbach says seeking the help of a qualified financial adviser is crucial.

“An experienced adviser can help you create a customised estate plan that reflects your family’s unique situation, ensuring no one is unintentionally left out” says Weilbach. “They can assist in setting up structures such as testamentary trusts, ensuring legal compliance, and optimising your estate for tax purposes.”

Ultimately, Weilbach says estate planning for complex family structures requires a delicate balancing act with foresight, flexibility, and advice. “We all want the best for our families, and that includes planning for the future. By working with a trusted adviser, you can create a plan that’s tailored to your unique situation that reflects your intent for those you care about.”

ENDS