Testamentary Trust
Once the assets are transferred into the trust, they no longer belong to the trust founder and the trustees are required to take over full control of the assets and ensure that they are managed to achieve the best outcomes
A trust can also be used strategically to safeguard your personal assets from the potential risks associated with business activities and/or insolvency. By setting up a living trust, you can transfer specific assets into the trust with the primary focus
As a word of caution, if your will is found to be invalid, for whatever reason, no testamentary trust can be formed which can result in your beneficiaries being financially prejudiced.
From an estate planning perspective, there are several mechanisms available to reduce estate duty liabilities and, in turn, maximise the inheritance for your loved ones.
A per stirpes clause, or by representation clause, is a legal stipulation included in a will that requires that if a beneficiary dies before you, that beneficiary’s share of the inheritance will pass to his/her heirs.
As an aside, it is important to note that this type of trust can only be set up for the benefit of a disabled person and no one else’s benefit. Where there are two or more beneficiaries to your trust,
Life insurance policies can be used to create liquidity in your estate and to make financial provision for your spouse and/or beneficiaries. However, as with other estate planning tools, it is essential to correctly structure your policy so that it
When it comes to planning the distribution of your retirement benefits to your heirs and beneficiaries, it is important to keep in mind that funds housed in approved retirement funds do not fall into your estate. Rather, the distribution of
To safeguard the trust assets against the effects of inflation, it will be necessary for the trustees to assume some investment risk, and it is important that the trustees have a sound understanding of how investments work in order to
Upon your death, your testamentary trust will come into formation and the assets identified in your will must be transferred to the trust. Your nominated trustees must apply to the Master of the High Court for letters of authority which
