As September is Wills Month in South Africa, many people are reminded of the importance of having a will. However, there are several misconceptions about wills that can lead to disputes, delays, and shortfalls. One of the most common misconceptions is that leaving a spouse "50% of my estate" gives them half of the total estate. In reality, if a couple is married in community of property, the joint estate splits automatically, with 50% already belonging to the surviving spouse.
Another misconception is that an ex-spouse automatically falls out of a will after a divorce. According to section 2B of the Wills Act, a will made before a divorce is treated as if the former spouse died before the testator, but only if the testator dies within three months of the divorce. If the testator dies after three months, an unamended will can still benefit the ex-spouse. This highlights the importance of reviewing and updating a will after a major life event.
Many people also believe that their debts disappear when they die, but this is not the case. Creditors are settled before any heir inherits, and assets may need to be sold to raise the cash. Additionally, a will does not decide who gets a pension or retirement annuity, as death benefits from a retirement fund fall under section 37C of the Pension Funds Act.
Some people think that they don't own enough to need a will, but an estate can include a home, a vehicle, bank accounts, and personal belongings. For a parent, guardianship arrangements alone justify a will, regardless of asset value. Furthermore, minors cannot inherit directly and manage an inheritance themselves, so a testamentary trust or guardian's fund arrangement is necessary.
Others believe that an informal understanding with family members is enough, but this is not enforceable. Only a validly executed will binds an executor. A handwritten note also does not count as a will, as it must be signed by the testator and witnessed by two competent witnesses. Cohabitation without marriage or a registered civil partnership does not create automatic inheritance rights.
Executor's fees are often misunderstood, with many people thinking they are fixed. However, the Administration of Estates Act prescribes a maximum tariff of 3.5% of the gross estate value, plus 6% on income earned after death, plus VAT. This is a ceiling, not a fixed charge, and it is negotiable before death, at the drafting stage. Institutions offering free wills may require appointment as executor in return, which can still result in executor's fees.
Finally, having a will does not mean that family members will automatically know what to do. A will does not provide information on where it is kept, who the executor is, or what documents exist. Families should know these details in advance, without needing every clause disclosed early. A will is a crucial document that speaks for a person when they can no longer do so, and it is essential to have one that accurately reflects one's wishes.
Key points
- A will is essential for ensuring that one's wishes are respected after death.
- Common misconceptions about wills can lead to disputes and delays.
- Reviewing and updating a will after major life events is crucial.
