It is time for the June 2025 edition of FC Viewpoint.

IN THE NEWS:

• The JSE All Share Index is on 96 921 on 10 June 2025.
• 1 US Dollar will cost you R17.67; 1 Pound = R23.91 and 1 Euro = R20.22.
• Annual consumer inflation (CPI) is at 2.8%.
• The prime lending rate in SA finally is, currently at 10.75% per annum, this is after the 25-basis point decrease in May.
• The price of Oil is $67 per barrel.
• In South Africa, the rand has now strengthened by more than R2 against the dollar since April, when it traded above R19,90/$.

Estate planning is about more than just drafting a will, it is about protecting your family, your assets and your legacy. Estate planning is crucial to ensure your assets are distributed according to your wishes and to provide for your loved ones after your passing.

Unfortunately, many South Africans make costly mistakes that only surface after it is too late. I want to highlight the 5 most common estate planning mistakes and show you how to avoid them.

1. No valid or updated will

If you die without a valid will (intestate), your estate will be distributed according to the Intestate Succession Act. This means the law dictates who inherits your assets, which might not align with your true wishes. What to do: Make use of a professional to draft a comprehensive and legally
compliant will and appoint a competent executor.

2. Not using a trust when you should

Using a trust in your estate planning in South Africa can be a powerful tool, but it’s not always necessary or beneficial for everyone. The decision to use a trust depends heavily on your individual circumstances, financial goals, and the needs of your beneficiaries.

What to do: Providing for Minor Children is one of the most common and compelling reasons to establish a trust or make use of a testamentary trust in your will.

3. Choosing the wrong executor or trustee

Choosing the right executor for your will and the right trustee(s) for your trust (if applicable) is one of the most critical decisions in your estate planning. These individuals or entities will be responsible for carrying out your final wishes and managing your legacy, often during a time of grief for your loved ones. Poor choices can lead to significant delays, financial losses, family disputes, and ultimately, your wishes not being fulfilled.

What to do: The executor is the person or entity responsible for winding up your deceased estate. This is a complex process that requires a specific skillset. Therefore, choose an executor or trustee with the relevant experience and
expertise.

4. Insufficient Liquidity in the Estate

Winding up an estate incurs various costs, including executor fees, master’s fees, advertising costs, and potential Capital Gains Tax (CGT) and Estate Duty.

What to do: Consider having liquid assets (cash in bank accounts) or taking out a life insurance policy with the estate nominated as the beneficiary. This provides the executor with the necessary funds without having to sell off other assets.

5. Overlooking minor children and guardianship

If you have children under the age of 18, it’s absolutely crucial to address their well-being in your estate plan. If you die without a will, or if your will simply bequeaths assets directly to minor children, their inheritance won’t go straight to them. Instead, it will be held by the Guardian’s Fund, which is administered by the Master of the High Court. If both parents pass away without nominating guardians in their will, the High Court
will have to appoint one.

What to do: Clearly state who you wish to appoint as the legal guardian(s) for your minor children and speak to the individuals you intend to nominate beforehand to ensure they are willing, capable, and understand the responsibility.

Establish a Testamentary Trust for Minor Children’s Inheritance
These 5 mistakes can delay winding up your estate, increase costs and create family conflict.

Wealth regards,

Fanie Jansen Van Vuuren CA (SA), CFP®

Director: FC Wealth and Investments (Pty) Ltd

E: [email protected]  |  T: 083 384 5868

W: www.fcfin.co.za