Myth busting – The truth about a your will
18 February 2020 | Banking
Here Anielle von Finckenstein, head of FNB Fiduciary helps bust some of the more common myths around creating a will:
Myth 1: I don’t need a will, I’m still young
This is one of the most frequent excuses for not having a will in place.
“Do you really have nothing to leave behind? If you’ve given up all your worldly goods to travel the world and live off the land, then it’s possibly true. But if you are employed, you have an income and have accumulated assets.
She suggests thinking carefully about what you would want to happen with the cash in your account or items that you own. “If you don’t have a will, these will most likely go to your closet blood relative – after a lengthy process. And if you have children, having a will becomes even more important to ensure their well-being should anything happen to you”.
Myth 2: Wills are costly
This is simply not true – in fact, wills can be completely free. FNB, for example, offers a will-drafting service to clients and staff free of charge. The only cost involved will be the safe custody fee for your original will to stay under lock and key at FNB Fiduciary, which is currently N$100 per year for a single will, and N$200 per year for a joint will.
“People associate wills with consultation fees and lawyers, all of which seem daunting and expensive,” says von Finckenstein. “But in reality, there are many companies that offer will-drafting services. These are not always free like at FNB, but most cost only a small amount.”
Myth 3: I can write a will on a napkin and it will be valid
“It works in movies – and in theory – but it’s not a great idea,” Von Finckenstein says. A will is a professional legal document. “There are all sorts of requirements to make a will valid, such as having every page signed in full by the person who drafted the will, plus two witnesses present who also need to sign in full on each page.”
FNB Fiduciary can help ensure your will is valid and easy to carry out to avoid common pitfalls, such as:
• Your marriage contract: Being married in community of property means your spouse already owns half of your assets in the communal estate.
• Pension funds or life insurance policies: If you’ve nominated someone other than a dependent as the beneficiary of your retirement fund your wishes might not be honoured, because pension fund legislation favours dependents above all other beneficiaries. When nominating a beneficiary for a life insurance policy, the proceeds of the policy will be payable directly to the beneficiary and not distributed as part of the rest of your estate.
• Consolidating debts: Calculate how much money would be needed to settle outstanding debts, including estate-related costs, otherwise you might not be able to leave much.
Myth 4: It’s too complicated
“Drafting a will is not nearly as difficult as you may think,” says Von Finckenstein. All you actually need to do is decide who are the people I want to leave my stuff to? And shat provisions do I want to make for my minor children?
It really is as simple as that. “The benefit of having an up-to-date will is that, if something should happen, you can be assured there will be a smooth transfer to your beneficiaries.”
Myth 5: I have a will and that should be good forever
“This is not true at all. You need to relook your will every time there is a significant change in your personal or financial profile – for example, if you get married or have a baby, take out a life insurance policy, buy or sell a property or a vehicle, and so on.”