In this article, we take a closer look at how you can safeguard the intended inheritance for minor children, taking into account the type of assets, beneficiary nominations, trust options and associated legislation. ADVERTISEMENT CONTINUE READING BELOW Bequeathing fixed property
An effective way of circumnavigating these risks is to set up a testamentary trust in terms of your will that effectively comes to fruition in the event of your passing. By bequeathing the property to the trust, the property will transfer to the trust upon your death and will be administered by your nominated trustees until your child is old enough to manage their own affairs.
Important note: If you nominate your estate as the beneficiary on your life policy and your minor child is named as an heir of your estate, there is always a possibility that they do not receive the full proceeds. Depending on the liquidity in your estate, the proceeds of the policy may be used to settle debt and pay creditors, bearing in mind that all debts in the estate must be settled before heirs can receive their inheritance.
Living annuities make excellent estate planning tools as they allow you to nominate beneficiaries to the investment with the assurance that they will receive their benefit. However, keep in mind that as minors cannot receive lump-sum payouts, your minor child’s legal guardian will be responsible for deciding how your child receives their benefit.
Important note: Where you have nominated beneficiaries to your living annuity, keep in mind that the funds do not form part of your deceased estate and will not attract estate duty.Funds held in a discretionary investment should generally be dealt with in terms of your will. In the case of tax-free investments, beneficiary nomination depends largely on the type of investment vehicle used.
South Africa Latest News, South Africa Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Source: TheCitizen_News - 🏆 6. / 75 Read more »
Source: mybroadband - 🏆 11. / 67 Read more »
Source: TechCentral - 🏆 8. / 71 Read more »
Source: ITWeb - 🏆 45. / 51 Read more »
Source: htxtafrica - 🏆 42. / 51 Read more »
Source: Channel24 - 🏆 48. / 51 Read more »