A will for every South African

Franklin Dikgale, FISA Chairman

FISA EXCO member Graham McPherson

The Fiduciary Institute of South Africa (FISA) estimates that only ten percent of the South African population has a will. FISA, which represents R200 billion of fiduciary assets, has a vision for every South African to have a will regardless of the size of their estate.

Speaking at a presentation in Johannesburg, FISA EXCO member Graham McPherson said South Africans were fortunate to have freedom of succession and yet it was hardly used. He said there are currently fewer than 5 million wills registered in South Africa. The number of valid wills may be even lower as many people have more than one will in circulation.

Of total reported adult deaths, an estimated 70% comprise estates worth less than R 125 000, which are dealt with by the Administration of Deceased Estates Act, and do not require a professional executor unless stated in a will. The remaining 30% of adult deaths are estates worth in excess of R 125 000, for which the Master of the High Court requires a full executor appointment which may or may not have been provided for in a will.

McPherson said: “A will clarifies the devolution of assets to family members at a time of grief. A will is not only an instrument in estate planning for high - net -worth individuals. If every South African had a will, this would reduce the number of intestate estates to be administered. A Will can furthermore be invaluable in guiding trustees of retirement funds in determining dependants when deciding on death benefit distribution in terms of Section 37C of the Pension Funds Act. Over time, this could make an impact on the large number of unclaimed benefits in the country.

Through its practitioner training and consumer awareness programmes, FISA is tackling the need to educate and inform the public about the importance and intricacies of a will. Individuals need to know that their marital regime takes precedence over their will and that ongoing legislative and tax changes mean that a will needs to be reviewed ideally once a year.

McPherson outlined the dangers of do - it - yourself Wills, and advised individuals seeking advice to consult FISA - accredited practitioners. He emphasized the importance of an Executor, pointing out it is your life’s financial worth that you entrust to an executor to attend to. Executor’s Fees are determined by statute, but can be negotiated and the public needed to be aware of this.

Wills are merely one aspect of estate planning and administration. FISA, which grew out of the Association of Trust Companies, has a broad mandate within the fiduciary industry in South Africa to raise standards and protect the public. FISA members include any practitioner with a fiduciary responsibility, such as lawyers and accountants active in estate planning, and taxation and financial advisers looking after clients’ assets.

FISA Chairman, Franklin Dikgale, said FISA is working at improving standards in estate administration. It is working with the S A Law Commission to streamline and update the Administration of Deceased Estates Act and attending to processes that delay the winding up of estates. In this regard, FISA is working with each of the Master’s Offices countrywide to standardize requirements and improve turnaround times as well as with institutions such as SARS, banks and Computershare.