August 2021 – Monthly Newsletter

Planning for your family

The Covid-19 pandemic has changed the world as we know it. Who would have been able to imagine two years ago that wearing masks would be mandatory, attending live events would become almost impossible and that many of our basic liberties would be restricted.

Almost everyone knows of a loved one, a family member, friend or colleague who has had their life impacted by the virus. If you or a loved one were to succumb to the virus, would your financial affairs be in order? Would you have sufficient funds available to ensure for the continued care and well-being of your family?

Momentum insurance has launched the Estate Provider Benefit. The Estate Provider Benefit ensures that clients are afforded a properly drafted Last Will and Testament as well as ensuring that your estate will be properly wound up in the most efficient manner. Funds are specifically made available for costs incurred which are often overlooked; executors fees, estate duty, capital gains tax and any outstanding debts.

The Estate Provider Benefit provides an instant cash pay-out within one day of receiving the death claim and ensures any funds left over after the provision of winding up your estate are paid to your beneficiaries.

For more information on the Estate Provider Benefit please contact Kevin or Greg on 041 373 0601.

A reminder to attend our webinar

Kevin Mills Financial Services will be hosting a webinar with Marriott Asset Managers on the 11^th August 2021.

Date: 11^th August 2021

Time: 11H00 – 12H00

Marriott’s Chief Investment Officer, Duggan Matthews, will be discussing the impact of the recent unrest seen in the country as well as highlighting the benefits of Marriott’s International Investment Portfolio and why this is an attractive investment proposition for investors wishing to gain access to global companies with a focus on providing investors with a sustainable and growing future income.

Please contact the office directly should you wish to attend the webinar. We look forward to hosting you for what is sure to be a very informative webinar!

October 2018: Presentation invite and nominating beneficiaries

Invitation to an Investment Presentation

2018 has been a tough year for investments! There has been political upheaval throughout the world and global stock markets have generally declined making important investment decisions very difficult. To try and make sense of the current investment climate join Rod Hunter, Sales Manager of Investec Asset Management as he provides a market update and reviews the key challenges facing South African investors in 2019.

Difference between beneficiary nominations in a Retirement Annuity and a Living Annuity

Retirement Annuities are governed by the Pensions Fund Act. Investors are able to nominate beneficiaries however, the Trustees appointed for the Retirement Annuity Fund consider the individual client’s circumstances and whether or not the client has any dependents. The Trustees then decide as to how the funds should be distributed.

Living Annuities are governed by the Long Term Insurance Act. This means that investors can nominate beneficiaries and on the death of the annuitant the benefit will be paid to the beneficiary. The beneficiary then has the option of choosing how they wish to receive their benefit. This can be in the form of a lump sum or the beneficiary can choose to receive a monthly income or a combination thereof.

Both Retirement Annuities and Living Annuities are exempt from estate duty in terms of section 3(2) of the Estate Duty Act, regardless of whether an annuity or a lump sum was chosen by the beneficiary.

Office Closure

Our offices will be closing on the 14^th December 2018 and reopening on the 7^th January 2019. Should you have any urgent queries/needs during this period you can contact Greg on 0027 61 017 3468.

“It does not matter how slowly you go as long as you do not stop” Confucius

May 2018: Estate Duty Planning

Estate Duty Planning

Estate duty is payable on the estate of every person who dies and whose net estate is in excess of R3.5 million. Estate duty is charged at a rate of 20%. For those individuals with estates over the value of R30 million estate duty was recently changed to 25%.

Estate Duty comprises the total of all the property (fixed property, business interest and investments) and deemed property (life insurance policies) of an individual less certain deductions.

Below is a basic illustration of an Estate Duty calculation:

Property + Deemed Property – Deductions = Dutiable Estate * 20%

The most common deductions are a Section 4A abatement and the Section 4(q) deduction.

The Section 4A abatement allows for an amount of R3.5 million to be deducted from the net estate of a deceased person.

The Section 4(q) deduction provides that any property that accrues to a spouse is deductible from the Estate Duty calculation. Most spouses typically leave their estates to their spouse. This creates a largely inflated estate for the surviving spouse and merely postpones the tax for when the surviving spouse passes away.

Momentum have introduced a Last survivor death benefit where the two lives are assured at the outset of the policy. Upon the death of the first assured life the future premiums are waived. Once the second life assured passes away the benefit is paid into the estate.

The advantage of this type of a policy is that it provides for liquidity in the deceased’s estate and allows for the beneficiaries to not have to sell assets to pay the tax liability.

The Last survivor death benefit is typically a quarter of the price of traditional life insurance, so this is an excellent way to mitigate against the cost of death taxes.

For more information regarding the Last survivor death benefit you can contact Kevin or Greg on 0027 41 373 0601.