Contrary to common belief, gifting assets to loved ones through a will may not be as effective as gifting whilst still alive.Here are 4 reasons why lifetime gifting may be more beneficial than gifting through inheritance:

1. Guarantees that the gifts in question are given to the intended person

There are several situations in which the donor’s intention may not be given effect to when gifting through a will:a. Invalid willWhen the correct will procedure is not adhered to the will shall be deemed invalid and not given effect to.b. Claims against the estate:Claims can be made against an estate, thereby making it possible that the particular gift does not end up with the donors intended beneficiary.Example 1:When a donor specifies in their will for all or most of their assets to go to a certain child. One of their other children who may have received less or nothing in the will could potentially challenge this and receive some of these assets, despite being contrary to what is written in the will. Note: this type of transaction is possible through lifetime gifting.Example 2:When a donor who has children specifies in their will for all or most of their assets to go to a certain organisation such as the Red Cross. In this case the children will have a very strong case against the estate and will most likely receive a large sum of the assets. Note: this type of transaction is possible through lifetime gifting.c. If the donor changes their mind about the content in their will but does not get around to revising it.

2. Avoids lawyer fees

3. Gift is instantaneous

Beneficiary does not have to wait for a minimum period of 6 months to receive estate entitlements.

4. Gift may be of more benefit to beneficiary during donors lifetime

For many beneficiaries, namely children, receiving money whilst their donor parent is still alive may be of greater benefit than if it were received when they are older and more established. This may help beneficiaries with study fees, purchasing their first house, affording an “overseas experience” or providing them with general financial security.Although creating a will is highly recommended, gifting during ones lifetime is something which should be considered in conjunction with a will for the benefits discussed above.The types of gifts best given during a lifetime are those which the donor does not regularly use themselves, or gifts the donor wants to go to a particular person/organisation without the fear of this transaction being challenged."The information posted on this website is prepared for a general audience, without investigation into the facts of any particular case. This information is no substitute for legal advice and does not create a lawyer-client relationship; you are advised to consult with a lawyer on any legal issue."