Do you have children or even grandchildren who are too young to manage money? Many people who are in the 60s would have children of 20 to 30 years old. If you do not have much saved then of course if you have willed your estate to your children then maybe your death results in them being able to pay off some debts or take a holiday. However if you have been fortunate enough to invest and save, often if you add up the value of a property and retirement savings and pension fund proceeds, the estate might run into several million.
The average youngster in his 20s who receives over a million Rand would probably not know what to do with it or would go on a spending spree. In addition if the young person was married in community of property then half of that inheritance would automatically and immediately become the property of the spouse.
It is possible to avoid all of these issues by specifying some or all of your estate proceeds being transferred into a trust to be set up on your death. There is a concession in the Estate Duties act that the first 3.5m of your assets is not subject to estate duty of 20% and all assets transferred to your spouse are tax free.
This gives you wiggle room to put aside funds to help your children however you want in later life which is often what a parent wants to do. The selection of trustees to carry out your wishes is of course critical and should include a trusted relative or friend and a professional trustee if possible.
Whilst there is an expense to running a trust there would be great peace of mind knowing that the trustees would follow your wishes in releasing funds to your beneficiaries for the purposes you specified.
We at Professional Management Consulting could assist you by supplying the professional trustee who could help you achieve your wishes. Contact us and we can give you peace of mind and help your children in the future.
