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The cost of education, and we follow up on Wills and Estate Planning

Updated: May 17

In this weeks edition of our newsletter we unpack the Cost of Education and then we also discuss the second edition of estate planning

Will document

Wills and Estate Planning

September is in full swing, and with National Wills month, we would like to encourage South Africans to get their Last Will and Testaments drafted, and signed.

Last week we unpacked some information on Wills, and this week we will unpack the problems that may arise if you pass away without leaving a valid Will.

Some of the problems are:

  • Your assets may not be left to the person/s of your choice;

  • It may take longer to have an executor appointed, and the appointed executor may be somebody you may not have chosen yourself;

  • There could be extra costs;

  • Your under age children's inheritance will go to the Government Dependents fund to administer on their behalf until they reach 18 years;

  • There could be conflict and infighting within the family if there are no clear instructions on how to distribute your estate.

At Wallstreet Financial Services, we not only assist with drafting and signing your Will, but another important factor is that we do a liquidity calculation to see if there is money in your estate to pay any potential creditors, do an in depth estate analyses and advice on the implications of how your estate is dissolved and distributed.

Did you Know:

  • If you nominate a beneficiary on a life cover policy, the proceeds pay to the beneficiary directly;

  • Any Pension, Provident Fund and Retirement Annuity forms part of the Pension Funds Act, wherein regardless of who you nominate as a beneficiary, there is a board of trustees that can override it, due the the fact that they first look at actual and financial dependents;

  • It is always advisable to when drafting a Will, to request a testamentary trust be set up if you have minor children, and nominate the trustees who should act in their best interests should something happen to you;

The cost of Education in South Africa

Apple and books on a desk

Last week I touched on teaching your child the value of money. This week i thought I would share with you the cost of education in South Africa, as this is a very important subject when talking to any parent we meet and assist.

Providing your child with the best possible education is fundamental to every parent but the true cost of education can be a very stressful for all parents.

Most people believe that having an education policy to cater for University fees would be sufficient, but when unpacking education in its entirety and how the building blocks of your child's education starts with Primary school, leading to high school is more important as it gives them the stepping stones and knowledge needed to enter university, they are usually shocked at the cost.

The cost of Tuition fees only for a single child from Primary school to Grade 12 in a private institution will cost approximately R4 million. Given the assumptions that school fees increase with 10% per annum (which they do), from the age of 6 to matric and an inflation rate of 6% pa.

Now this might not sound like much given the fact that it is over a period of 12 years, but when you work it back, it would be a cost of R13'000 per month today per child.

Then when you look at University, the cost of getting a degree depends on which degree the student wants to do as well as the choice of University.

A Doctors degree will cost you on average a further R225'766.28

A Law Degree will cost you on average a further R160'000.00

Now remember that when a student studies, there are other associated costs to factor in which include, rent (if your child does not live with you), vehicle and fuel, pocket money, books and stationary and food.

"The cost of education is expensive, but its an investment into your child's future, where you are helping your child get the best possible opportunities in their life."

Our advice:

  • With this knowledge that I just explained, relook your educational savings for your child/ren as to ascertain if you do in fact have enough for them;

  • Start saving towards their futures as soon as possible;

  • In your financial plan, incorporate their education costs in the event of your death or becoming ill or disabled;

  • Speak to us about your education planning and other financial planning needs.

Our social initiative: Sandwich Tuesdays

At Wallstreet we make and distribute sandwiches on Tuesday mornings to the less fortunate and needy in our area and surrounds. This initiative came about with our fundamental belief in giving back.

A Sandwich might not mean that much to you and I, but to somebody without a home, it means the entire World.

This week we made and distributed 36 sandwiches to the needy.

My challenge to our clients and everyone is to just make a sandwich on a Monday evening, and give it to that person you see at the robot en route to the office. Just that 1 sandwich that you hand out to that person, will make the worlds difference to him or her.

Lets be the change we want to see!


Your Financial Planning Partner

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