With a new baby, it is important for both parents to have up-to-date wills. Youll need to decide on and designate a legal guardian stipulated in your will a person you both choose to raise your child in the event of an unexpected tragedy.

You may also wish to set up a trust for your child and name trustees separate from your chosen guardian. Through a trust, you can ensure your estate is paid out to your child according to your wishes. Among other things, trusts can be used to:

• Shield assets from potential creditors
• Preserve assets for minor children until they are of age
• Create a pool of investments that can be managed by professional money managers, known as trustees

Trusts can be very useful financial tools and you should discuss their pros and cons with an accredited financial adviser. But keep in mind, they can be expensive to set up and maintain and there are some other disadvantages that may affect you, as well.

Yes. Insurance companies make payments to the nominated beneficiaries on the policy, and not to the beneficiary mentioned in a will, even if the will has been updated after the beneficiaries have been nominated with the insurance companies. To ensure that the correct people receive the payouts from the various insurance companies, check who the nominated beneficiaries are on each of your policies and contact either the company, your financial advisor, or even Finlogic, so that we can assist you in changing your beneficiaries if necessary.

The death of a spouse is a traumatic experience that not only has major emotional but also financial implications.

A sound financial strategy is imperative to minimise financial worries and burdens and to allow you to grieve and heal.

Professionals to contact.

It is important to seek professional advice to help deal with the copious legal requirements and the mountains of paperwork. You should contact the following professionals:

• Your attorney to review your spouse's will and to begin the proceedings needed to wind up the estate
• The funeral director to obtain copies of the death certificate
• Your financial adviser to assist you in submitting life assurance claims and to help you put in place your future financial strategy

Covering immediate expenses

There will be a number of immediate expenses that will have to be paid. Funeral expenses, perhaps medical bills and outstanding accounts accrued by your spouse may add up to a substantial amount. If you and your spouse had in place a proper financial plan that takes into account medical expenses and funeral costs, your insurance policies will cover those charges.

Life insurance claims are usually settled very quickly and if you are listed as the policy beneficiary you will have cash to settle immediate expenses. However, if your spouse's estate is listed as being the beneficiary the process is a lot more involved and you may have to make other arrangements.

Some options could include using a credit card, taking a personal loan, accessing money from your bond etc. But if the truth be told, do the planning properly, in partnership with your financial adviser, before one of the partners dies and all of those hassles will be avoided.

Life Insurance Claims

You must formally file a life insurance claim. It is not an automatic procedure. Contact your financial adviser so he/she can assist you.

You should also check:

• If your spouse had insurance through his employer. Many companies offer a group life insurance benefit
• Accidental death. Your spouse may have this cover from an employer, credit card, or bank. You may be unaware of this policy, as it can be offered as part of a loan package or issued as a free benefit by banks, or as a rider to an employer-issued insurance policy. Check with the employer, bank or insurance company
• Mortgage Bond protection insurance. This is a life insurance policy that pays off the balance of the amount outstanding on a mortgage bond. Contact your mortgage provider or financial adviser
• Travel Insurance. If your spouse was killed while travelling by air, boat, or train, there could be benefits from a policy purchased when buying the tickets. If the tickets were purchased using a credit card you may be entitled to a benefit if he or she died as a result of an accident while using those tickets
• Credit life. In many instances institutions providing credit offer insurance that covers the outstanding debt in the event of death. A small amount is added to each monthly repayment to cover the cost of the premium. Check with the credit provider to see if this option was in place
• It cannot be stressed enough: it is much easier to handle the process if the ground-work is done before the death of a spouse and if proper planning is done and up-to-date records are kept

NOTE
Retirement funds are exempt from Estate Duty.
This latest development will allow a person to be able to use Retirement Annuities as a vehicle to remove money from their estate. If the amount was not an allowable tax deduction, then the proceeds can be paid to the beneficiaries (as long as they are the dependents, or that there are no other dependents) either as a tax free lump sum alternatively they could chose to take income from these funds.