What is ‘Estate Planning?’
Estate planning is the collection of preparation tasks that serve to manage an individual’s asset base in the event of their incapacitation or death, including the bequest of assets to heirs and the settlement of estate taxes.
Most estate plans are set up with the help of an attorney experienced in estate law.
Some of the major estate planning tasks include:
- Creating a will
- Limiting estate taxes by setting up trust accounts in the name of beneficiaries
- Establishing a guardian for living dependents
- Naming an executor of the estate to oversee the terms of the will
- Creating/updating beneficiaries on plans such as life insurance, pension funds and retirement Annuities.
- Setting up funeral arrangements
- Establishing annual gifting to reduce the taxable estate
- Setting up durable power of attorney (POA) to direct other assets and investments
- Married in community/out (with or without accrual)
- Liquidity (Settle debt and stop the sale of assets below market value)
- Who inherits what (Last will) and will they be able to look after the assets (minor children, disabled persons, can the spouse manage money? etc.)
- Trusts (Understand what a trust is/does and dangers of a trust)
- Retirement assets (Preservation funds, pension/provident funds, living annuity, group risk?)
- Business assurance (relevance?)
- Estate duty, CGT, transfer duty etc.…
BREAKING DOWN ‘Estate Planning’
Estate planning is an ongoing process and should be started as soon as one has any measurable asset base.
As life progresses and goals shift, the estate plan should move to be in line with new goals. Lack of adequate estate planning can cause undue financial burdens to loved ones (estate taxes can run higher than 20%), so at the very least a will should be set up even if the taxable estate is not large.
G and S Makelaars (PTY) Ltd has skilled and experienced consultants to assist our clients with a financial needs analysis regarding their estate planning to ensure peace of mind for their families and for those who are business owners.
Please contact our offices for an appointment.