Johannesburg – The final season of the very popular HBO series Succession premiered in March, and fans eagerly watched to see who would succeed Logan Roy as CEO of Waystar Royco during the finale last month.
While the Roy family billions aren’t something many of us can relate to, David Thomson, senior legal adviser at Sanlam Trust, said that it is a reminder that inadequate estate planning—or keeping your plans under wraps—can create real-life family dramas.
"When parents pass away without proper estate planning, their children are often left to pick up the pieces, and this can be an emotionally and financially taxing experience," says Thomson.
According to Thomson, it can be difficult to know where to begin; however, having a pro on your side can make the process a lot less scary. He explains several crucial factors here:
Make sure that your parents have a working will:
Making sure your parents have a legitimate will is the first step in organising their affairs. This gives your parents peace of mind knowing that the individuals they cherish the most will be taken care of after they pass away. If they pass away intestate (without a valid will), you and your loved ones may have long-lasting financial and legal difficulties.
Make a list of their resources:
You might need to assist in compiling the list to make sure it is comprehensive; it should include their retirement money, bank accounts, investments, and insurance policies. If your parents want you to manage their online banking accounts, talk to their bank about the requirements and get the necessary written permission.
Obtain a general power of attorney:
Your parents might grant you a general power of attorney (POA) if they want you to handle their financial matters. When they are unable to be present physically, such as when they are ill or immobile, a POA grants you the authority to act on their behalf.
If your parents become mentally incapacitated, you have two options: either ask the High Court to put them under curatorship or request an administration order under the Mental Health Act. Applying for curatorship is a difficult and expensive process because you'll require strong medical support, a lawyer, and advocacy services.
The key is to plan:
It's best to plan ahead, as with other financial issues. Ask their financial advisor, with your parents' permission, to advise you on financial matters if they have one.
When handling your parents' business, there are a number of essential errors to avoid, including:
1. Combining their financial resources with your own.
2. Not administering estate issues with the utmost good faith and care and acting as a trustee should.
3. Not creating a budget.
4. Not taking into account your parents' life expectancy and running out of money too soon.
5. Making your parents submit to your personal will.
6. Refusing to consider the possibility that your parents may be suffering from irreparable mental and physical decline and need the High Court to appoint a curator.
7. Not being completely honest with siblings helps prevent envy and misunderstandings.
"As difficult and uncomfortable as this conversation can be, you must have open and honest conversations about your parent’s finances to help mitigate legal, financial, and emotional challenges when they’re gone," said Thomson.
The Star