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Wills and Trusts and Beneficiary Funds

Your last will and testament is one of the most important documents you will ever sign during your lifetime. Your will is an essential part of estate planning as it stipulates how you want your assets dealt with upon your death.

Your estate refers to everything you own and owe, from property and cars to investments and debts. Proper estate planning will ensure that your estate is set up in a tax-efficient way that benefits you during your lifetime and your beneficiaries after you die.

A properly structured estate ensures that:

  • There is enough cash to pay outstanding debts.
  • There is an income (and capital if required) for your dependants.
  • The estate is distributed according to your wishes.
  • Your business interests are protected.
  • Taxes are minimised (e.g. estate duty and income tax).

As it is a crucial area of financial planning, it is worth getting professional advice if you are drawing up a Will. If you do not have a valid Will, you die intestate and the laws of intestate succession apply. In other words, the law of the land designates beneficiaries according to specific kinship.

Executors

You must appoint an executor in your will. The executor is responsible for ensuring that the terms of your Will are carried out and that your estate is administered in terms of the Act. Ideally this should be a professional person or trust company, who specialises in the drafting of wills and administering deceased estates. If you do not have a Will, an executor will be appointed by the state.

Testamentary Trusts

A Trust can be established in your will in order to hold and administer assets on behalf of a beneficiary. Whether it makes sense to set up a Trust fund depends on the beneficiary’s circumstances and the value of the assets. Some reasons for setting up a Testamentary Trust include:

  • To provide for maintenance obligations.
  • To ensure that minors' inheritances are invested until a certain age (age of majority is 18).
  • To administer assets on behalf of immature/handicapped beneficiaries during their lifetime.

Beneficiary Funds / Employee Benefit Trusts

On the death of a member of a Pension or Provident Fund, the Trustees of the Paying Fund will meet to determine the legal and factual beneficiaries of the death benefit payout. Should any of these beneficiaries be minors i.e. under the age of 18 years of age or physically/mentally challenged majors, their portion would be paid into a registered Beneficiary Fund.

Old Mutual Trust administers the Old Mutual Trust Beneficiary Fund on behalf of minor dependents until they reach the age of majority.

Should you need assistance or wish to contact the Administrator of the Old Mutual Trust Beneficiary Fund please telephone the call center on 0800 220 290.

Contact Old Mutual Trust

Should you need assistance with the drafting of a new Will, updating your existing Old Mutual Trust Will or need expert advice on estate planning, please email us.

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