Santam Trust says it is seeing an increased demand for wills among demographics that, traditionally, have not been interested in estate planning. Its experience confirms the results of a study by Brand Atlas that 44% of economically active South Africans have either amended or created wills in the past 18 months.
The study, released in August, also found that 84% of South Africans have become more aware of their mortality. Moremadi Mabule, the head of Wills Operations at Sanlam Trust, says the Covid-19 pandemic has contributed to South Africans thinking about death more.
The study found the motives for having estate planning differ according to age group. For example, tax-efficiency was top-of-mind for white men aged 50 and above, while 25-to-39-year-olds were more concerned about controlling who will get what when they die.
Nevertheless, 54% of South Africans do not have a will, and with National Wills Week upon us, it’s pertinent to ask why.
According to the study, of the respondents who said they did not have a will, 90% said they did not believe they had enough assets to warrant having a will, or if they did have assets, they simply hadn’t got around to it.
Nabawieya Abrahams, the quality and control manager in Sanlam’s wills department, said other reasons people did not have wills were the perception that drafting a will was too complicated or too expensive, or their “family will know what to do”.
It seems that many South Africans still do not understand how not having a will could have dire consequences for their loved ones, including forcing a surviving spouse to sell the family home in order to pay out the heirs, or a severe delay before an estate can pay out its beneficiaries, potentially leaving their family in a financial bind.
Almost as bad as not having a will at all is having an outdated will.
Abrahams says the need to take out a mortgage bond from a bank often acts as a trigger for obtaining other financial products and services, including a will. Then more assets are acquired – along with significant life changes (children, divorce) along the way – but the will is not updated.
However, on the upside, Mabule says “we’re seeing a psychological shift, with different demographics starting to invest in estate planning. It’s no longer seen as ‘reserved’ for the rich.”
According to the study, over the past 18 months, 35% of people updated their wills, while 9% drafted their will for the first time. Nearly 50% of the first-timers came from lower-income groups, suggesting that South Africans from across the economic spectrum are starting to put more consideration into their financial legacies.
Abrahams says her department has seen “a flood” of requests for wills from people in lower-income groups, as well as young people.