Article courtesy of Law Dot News |Will – Late Estate

Beyond Your Will: Leaving a legacy

“Legacy is not leaving something for people. It’s leaving something in people.” (Peter Strople, former Dell Computer Corporation director)

Leave a personal legacy, not just a financial one

We all know how important it is to our loved ones that we leave behind a valid will rooted in a comprehensive estate plan, but our legacy should go a lot further than just distributing assets.

Sharing with your heirs your values, your family history, and the wisdom your years have granted you can be one of the most important gifts you leave, often outlasting tangible bequests by generations. On a practical level, it will also help your heirs value, preserve and enjoy the wealth and the heritage that you leave them.

Start with a family mission statement

This sounds very corporate and complicated, but in fact it’s really simple and entirely personal. A family mission statement is foundational in legacy planning and will help everyone focus on the values and priorities important to them. As Stephen Covey (author of The 7 Habits of Highly Effective People) puts it “A family mission statement is a combined, unified expression from all family members of what your family is all about – what it is you really want to do and be – and the principles you choose to govern your family life.”

Of course, the mission statement must be collaborative, and everyone, even young children, can share in putting it together. You never know who will come up with a bright idea or two!

There’s a useful downloadable worksheet here if you need help getting started – personalise it to your family’s situation, and adapt it as you go along.

Share and discuss your plans

Openly sharing and discussing your estate planning and the provisions of your will with your nearest and dearest isn’t just an opportunity to prepare everyone for the financial implications of your death. It’s also a great way to involve everyone in your planning and to ask for their input.

Discuss the financial structures you have already put in place, or are planning for the future. Talk about your vision for the wealth you will leave behind and why you have made the bequests you have. Sharing all that, and relating it all to your family mission statement, will significantly reduce the risk of unhappiness and disappointment when the time comes for your last wishes to be implemented.

Craft your “legacy letter”

This isn’t your will (although it’s sometimes misleadingly referred to as an “ethical will”).

What’s the difference? Your formal will, which must comply with all legal formalities to be valid, sets out who is to inherit what from you. In contrast, your legacy letter is an informal and personal letter from you to your loved ones, sharing with them whatever you think will be of value to them in their lives. It needn’t be just one letter – many people choose to write individual letters to each member of their family.

There’s a lot to be said for sharing all these things informally with your family while you are still around, but don’t stop at verbal discussions. Writing them down and leaving them in letter form will give your heirs a permanent point of reference.

What should you include in your legacy letter? Really, anything that you think will help your loved ones live richer and more fulfilling lives. Perhaps share some of your family history, stories of your own life and the lessons it has taught you, your values, and your hopes and dreams for each of them. What challenges have you faced and how did you overcome them? What was really important to you at each life stage? What are your most cherished memories? What stories and advice from your parents and grandparents really helped you? What principles have inspired your financial successes?

The Confucian advice to “Study the past if you would define the future” rings as true today as it did two and a half thousand years ago.

A practical five-point plan brings it all together

1. Your estate plan underpins everything, so review and update it regularly.
2. Take legal and tax advice on forming a family trust. Depending on your circumstances and objectives, it could be the perfect way of guaranteeing that the financial part of your legacy is protected and managed wisely for generations to come.As to the more personal side of your legacy, the trust’s name itself will preserve your family name no matter how many of your descendants may in due course acquire new surnames.
3. Most importantly, leave behind a valid and updated will (“Last Will and Testament”) that clearly reflects your wishes and complies with all legal formalities.
4. To accompany your will, put together a “Notes for my executor and loved ones” file with all the information and documents that your executors and heirs will need when the time comes.
5. Last but certainly not least, be sure to include your legacy letter. This ensures that you aren’t just leaving your family all your worldly wealth, but also a real legacy – your own personal message for the future, direct from you to them.

Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact us for specific and detailed advice.

© LawDotNews

Article courtesy of Law Dot News |Wills and Estate Planning

In the Land of the Will, Clarity is King

“The golden rule for the interpretation of testaments is to ascertain the wishes of the testator from the language used. And when these wishes are ascertained, the court is bound to give effect to them, unless we are prevented by some rule or law from doing so.” (Quoted in the judgment below)

When drawing up your Will (“Last Will and Testament”), remember that “clarity is king”. Ambiguity is one of the cardinal sins of will-drawing because it exposes your loved ones to the risk of uncertainty, dispute, rancour, and quite possibly expensive litigation.

Worse, if in the end a court has to try and decipher what you actually intended, there is no guarantee that it will be able to correctly ascertain your true wishes.

A case of different interpretations and a bitter dispute

A recent SCA (Supreme Court of Appeal) case confirms once again the need to express your wishes clearly and unambiguously in your will –

• A bitter dispute between a widow on the one hand and her three step-children on the other had its roots in a deceased father’s ownership of two plots. On the one plot the father had built houses for his two daughters, with his son building flatlets for renting out on the same plot. He and his wife lived in their house on the other plot.
• The dispute centered on two different interpretations of a clause in the father’s will in which he had left both plots to his daughters, but subject to a right of habitatio in favour of his wife. That, said the executor of the deceased estate, gave the widow the right to live in, and to rent out, the buildings on both plots.
• The widow’s step-children on the other hand argued that it could not have been their father’s intention to give his wife such rights to the plot in question in light of all the “surrounding circumstances”. They made much of the fact that their parents’ ante-nuptial contract referred only to the other plot (the one with the marital home) in that context. They also pointed out that they had all agreed informally to each of the siblings being allocated a “portion” of the disputed plot.
• The siblings accordingly refused to pay out any rentals to the executor, and the dispute eventually found its way into the courts – first the High Court and then the SCA.
• In confirming the widow’s right to live in the buildings and to let/sub-let them out and receive rentals from both plots, the SCA confirmed that a court will establish the intention of the deceased from the language used “in its contextual setting”. In other words, “the will must be read in the light of the circumstances prevailing at the time of its execution.” Thus, in this case it was relevant that the father had not changed his will to reflect the informal allocation of “portions” of the disputed plot between his children, and that he had probably intended his wife to benefit from the receipt of rentals for her financial well-being and maintenance.
• But beyond that, there is no place for the introduction of “extrinsic evidence” or “surrounding circumstances” if the wording of the will is clear and unambiguous – as it was in this case.

Bottom line – it is critical that the wording of your will be drawn professionally to correctly, clearly, and concisely set out exactly what your wishes are.

Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your professional adviser for specific and detailed advice.

© LawDotNews