It’s meant 2B: Make a date with your estate planner before it’s too late
Recent changes to Section 2B of the Wills Act may bring some short-term relief in the already stressful time during divorce or death. Do you understand how the change may impact you?
“In short it means that the Law now gives you three months after your divorce to amend your will to remove, or ‘write out’ the spouse from whom you are getting divorced,” says Willie Fourie, Head of Trusts and Estates at PSG Wealth.
The exception to the rule is that the divorced spouse can still inherit from the deceased estate within the three months, if the will specifically provides for that. However, if you fail to amend your will within the three months after the divorce, the presumption falls away and your divorced spouse will stand to inherit his or her portion in terms of your will, as if nothing has changed. Update your will, before it’s too late.
“You clearly wouldn’t want your ex to inherit from your estate and forgetting that they could, if you pass away any time after the three-month clause expires, is an estate planning error best avoided. Remember that a change of marital status can even trigger unexpected health issues, so it’s always best to keep your estate plan in line with your current wishes,” Fourie adds.
Changing a will after or during a divorce is often the last thing that comes to mind, but it needs to be top of mind and part of your checklist to your new chapter.
“I had a client ask me to revise his will ten years after his divorce. He had since re-married and had two children. I informed him that if he were to die, as it stands, his previous wife - who is now living overseas - would be the sole heir to his estate, to the exclusion of his second wife and children. Needless to say, he was shocked at what could have been, had something happened to him before he made this crucial update,” Fourie says, adding that many people forget that an estate plan is a moving part of life.
While the surviving spouse and children, in the case of Fourie’s client, would be able to claim from his estate for maintenance, it wouldn’t be close to what he truly intended for his family. A robust estate plan ensures that your financial plan reaches its conclusion.
For divorced individuals who aren’t sure if their will is up to date, let this legislation be an important reminder to act fast. You may be single, or happily married at present, but a previous partner may still be linked to your current estate plan, or you haven’t even drafted one yet. Working with a qualified fiduciary adviser ensures your estate plan does what you need it to, and here’s why:
- Legislation and tax consequences will be factored in appropriately
- Updates to legislation (that is often changing and complex) will be communicated to you clearly
- The wording of your intentions will be solid (often drafting your will from a template online can mean the words you use, don’t quite measure up with what you actually want)
- Updates can be made as needed, and at least annually you will have a review, which assesses if your estate plan still matches your wants and needs
“Make the most of the time you have to get your estate plan in order - so much can happen in just a moment, never mind three months,” Fourie concludes.
Catherine Riley cdcom
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