Changing family structures require a rethink of legacy planning

Johannesburg - As South African families evolve beyond traditional household structures, people need to be more deliberate about ensuring their legacy plans reflect who they consider family, who depends on them and how they want those people to be provided for when they die.

This is one of the insights emerging from Liberty's Evolving Families research, presented this week to coincide with National Wills month, which explores how economic, social and cultural shifts are reshaping South African households and their financial behaviours. The research found that over half of South African household structures no longer fit the traditional nuclear mould, with blended and multigenerational families, cohabiting couples and people living independently while remaining financially connected to wider family networks becoming increasingly common realities.

According to Siphokazi Sobazile, Senior Legal Marketing Specialist at Liberty, these changes require a broader approach to legacy planning.

"Legacy planning needs to start with the family someone actually has rather than an assumption about what that family looks like. The important questions are: Who are your people? Who relies on you, who do you rely on, and do the plans you have made appropriately reflect those relationships and your intentions?"

The research shows that financial interdependence within families is not always immediately visible. In multigenerational households, for example, money may be pooled informally, with different family members contributing towards groceries, electricity and other expenses while maintaining separate finances. Dependency can also extend beyond income: the research highlights how the death of a grandparent who provides childcare can leave a family with a new financial burden as that unpaid contribution suddenly needs to be replaced.

"This challenges us to think about financial protection differently," says Sobazile. "It is not only about whose salary would need to be replaced. Families should also consider whose contribution would need to be replaced and who would be financially affected by that loss."
With blended families, cohabiting couples and multigenerational households becoming increasingly common, attention should also be paid to the gap between assumption and legal reality.

"People often assume that a long-term partner or a stepchild they've raised will automatically be provided for, but our law doesn't work that way," she adds. "Cohabiting partners have no automatic right to inherit from each other without a valid Will, and stepchildren generally have no legal claim to a deceased estate or to medical aid unless they've been formally provided for. These aren't rare edge cases anymore – they're increasingly the norm, and an outdated or non-existent Will is often the biggest single risk to a family's financial security."

For someone in a blended family, intentional planning may involve considering a current partner alongside children from previous relationships. For someone in a multigenerational household, it may mean recognising a wider network of people who could be financially affected by their death.

Rather than relying on assumptions, Liberty says people should consider whether their Wills, beneficiary nominations and broader financial arrangements continue to reflect their current relationships, responsibilities and intentions, and seek appropriate financial and legal advice.

"The question shouldn't only be, 'Do I have a Will?'" says Sobazile. '" If I were to pass away, would the plans I have in place adequately provide for the people I intend to protect?
The research also identified a less obvious legacy risk: household financial knowledge can sit predominantly with one person. That individual may know which policies exist, where documents are stored and how the family's financial affairs work, leaving others vulnerable if they die.

"A good legacy plan should provide clarity, protection and clear division of assets"  " says Sobazile. "The appropriate people should know what arrangements exist, where important information can be found and who they need to contact."

"As our families evolve, our financial planning needs to evolve with them. Legacy planning isn't simply about what you leave behind. It's about the people you leave it for and making sure your intentions for them are clearly reflected in the plans you've made."