Free will?

Over the last couple of month I have seen a number of TV ads offering a variety of "free" financial and legal services. Included in some of these is a Free Will.

I have learnt over the years that you rarely get anything for free especially from the financial sector. A free will can sometimes be a very expensive purchase! As far as I understand the financial institution writes up your last will and testament for you for free but you are then forced to make them executors of your will and this allows them to claim their fees against your estate. These fees are a usually 3.99% of the GROSS assets in your estate, now this amount does not sound too much but the problem is that it is calculated on the gross assets and not nett assets.

You thus end up in a situation where you buy a house for R1,000,000 and then die within the first year of buying the house, which means you owe R1,000,000 and thus the nett value of this asset is R0 but your executor still has a claim of R39,000 from your estate for executors fees. Far from free in my book! You should then also receive the life insurance payout of R1,000,000 to pay off your bond - does the executor claim another R39,000 from this amount as well? Probably.

Please ask about any "free" service offered to you by a financial institution and read the fine print carefully. It is your right to ask questions if you don't understand and please don't sign until you understand what you are committing yourself or your estate to.

You can appoint anyone to act as executor of your estate and it is a good idea to find the most competent person you know to do this, please also consider your attorney or accountant when making this decision. People typically do not negotiate executors’ fees upfront, but rather leave surviving family members to deal with this issue after death – if at all. Most executors will only consider a reduced fee if requested by the beneficiaries, who are at that stage going through a difficult time. It is better to negotiate this upfront and the negotiated fee should then written into the Will which binds the executor.