Can you afford to die? Here’s why it’s important to have a will

It is a topic we all prefer to avoid: can you afford to die? However, if you take the time to answer this question, you could, provided you have a will in place.

More than half (51%) of South Africans surveyed in the 2024 Sanlam Legacy Survey did not think they need a will because they do not own enough to justify having one, while 40% admitted they want a will, but did not yet get around to drafting one.

The 2024 Sanlam Legacy Survey, conducted amongst 1 200 South African online respondents, nevertheless confirmed that while only 35% of respondents have a will, 98% of them expressed a keen desire to leave a legacy for their loved ones.

Amrith Bishoon, executive manager at Sanlam Legacy, points out that wills are not only for people who have a lot of money or assets. “In fact, not having a will can profoundly affect the future of your family when you pass away, irrespective of whether you owned a lot or not.”

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A legal document about your wishes

He says you should think of a will as a legal document that not only describes who should get what when you pass away, but as one that also clearly states your wishes about who will look after your children after your death. If you have children with special needs, or if you have concerns about how your children’s education and the money you leave behind for them should be managed, a will is all the more important.

“There is the potential for conflict if you did not clearly state who should inherit your family home, or other items that may be of monetary or sentimental value for you. A will is more than a legal document – it is a roadmap that helps your loved ones avoid conflict and confusion, and it protects your legacy.”

Key insights from the 2024 Sanlam Legacy Survey include what motivates people to draft a will, 21% did not know much about wills and one of the biggest barriers is that people do not think they own enough.

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What motivates people to draft wills?

Most surveyed South Africans (57%) believe that creating a will is the right thing to do, while 48% felt driven to draft one to avoid family disputes and 45% were motivated by the fact that they have children.

Bishoon says there can be a lot of heartbreak when a family fights over an estate. “Without a will as a guide, conflict can quickly erupt when emotions and financial strain run high. It is not surprising that children are a major motivator for drafting a will. As a parent, you want to know your children will be safe and cared for should something happen to you.

“Without a will, you have no say in who will look after them when you are gone, or how they will be raised – the Master of the High Court will decide. You also cannot necessarily ensure their inheritance is protected should your former spouse remarry, for example. You want the least possible disruption to their lives. A will can help you accomplish that.”

Do you know enough to draft a will?

The need for more accessible consumer education was highlighted by the fact that 21% of respondents said they do not know a lot about wills.

Bishoon says a will is crucial at every life stage. “Early on in your family life your aim could be to protect your loved ones from your student debt. Or, later on, you could be getting a divorce. Then the risk is that if you do not update your will, your former spouse could still inherit, even if you did not want it to happen.”

Do you own enough to have a will?

One of the biggest barriers to having a will was that people did not believe they own enough, with 60% of those without a will saying they could be convinced to draft one if they owned more assets.

Bishoon says 27% of respondents believed you need to own assets worth at least R500 000 to justify having a will, while 14% believed you need to be worth more than R5 million. “Neither of these statements are true.

“It does not matter how little material possessions you have to your name, if you are older than 18, you should have a will.” Respondents in the survey with wills were more likely to be white, property owners, business owners, or have income of more than R30 000.

“We need more consumer education about what happens if you pass away without a will. People must know the state then winds up your estate according to the Intestate Succession Act by dividing your assets between your surviving spouse, children, parents or siblings, which can be a lengthy, costly and impersonal process.”

He warns that if you have no life insurance and it takes a long time for inheritances to be distributed, your loved ones could come under severe financial strain. “No matter how much you have, a will can help expedite the estate administration process, which could alleviate potential financial burdens on your loved ones and give them more time and space to grieve.”

Who should draft your will?

In the survey 61% of respondents said they would trust financial advisers to draft their wills, followed by banks (54%) and big financial institutions (37%).

Bishoon says this shows the crucial role financial advisers can play in encouraging clients to draft their wills. A will requires two witnesses and a wet ink (pen on paper) signature to be valid. It can be a complex thing to think through, especially when it comes to questions around guardians and trustees, for example. This is where an intermediary can make a meaningful difference.”

Can you afford to die?

Marnus Mostert, franchise principal and certified financial planner at Consult by Momentum, says it is important to ask yourself if you can afford to die. “It sounds like a strange and dark question, but the reality is that many of us are ill-prepared for death. While no one likes to think about dying, the reality is that if you do not make provisions, those you love most in the world will suffer the consequences of your lack of preparation.”

He gives these tips to keep in mind when you daft your will:

• It must be in writing
• You must nominate your beneficiaries
• You must nominate guardians for your minor children
• You must appoint an executor to manage your estate
• You must specify how your assets should be distributed
• You must specify if you want to be cremated or buried and whether you are (or want to be) an organ donor
• You must make provision for a trust, if required and nominate trustees
• Two independent witnesses must co-sign your will to ensure compliance with the law. This means that they must not inherit anything from you.

Mostert highlights that while free online tools exist to help you draw up a will, it is worth the money to have it drawn up for you by a professional, such as your financial adviser or lawyer. “There are specific requirements involved in drawing up a will as well as its signing and if you fail to adhere to these, you risk your will being contested or deemed invalid.

He says the cost associated with dying is probably a lot more than you realise. The common estate administration fees in South Africa typically consist of executor fees (up to 3.5% of the estate’s value excluding VAT), conveyancing fees, advertising fees, master fees, other miscellaneous taxes and estate duties (20% on the first R30 million and at a rate of 25% on the dutiable value of the estate above R30 million).

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Mostert says one of the best ways to ensure sufficient cashflow to cover these administrative expenses is to have a life insurance policy in place.

“Life insurance provides financial support for a family after the policyholder’s death. It offers the necessary liquidity to settle fees and taxes, while also covering any debts you may owe, as well as ensuring the living expenses of your family are met.”