Whilst this answer is a bit like ‘how long is a piece of string’, there are 4 elements you need to take into consideration:

1. Liquidity – or access to cash.  It takes roughly 2 years to wind up an estate, so the surviving spouse or children will need 2 years worth of cash.  It’s not enough to have joint accounts as any account in the deceased’s name will be frozen.  Life insurance pays out immediately, and bypasses the estate.
2. Tax – Believe it or not, 20% of your estate is dutiable above R3.5m and you will pay capital gains tax of up to 18% on every asset that has grown since you last bought it.  The tax man gets paid first.
3. Debt – death is seen by lenders as breaking a contract, and so the deceased person’s debt becomes due and payable on death.  So you need enough money to cover all debt due, and the estate needs to pay this after it pays tax.
4. Ongoing Living expenses – if you don’t currently have enough money to pay school fees and living expenses, then you will need to provide for that through Life insurance.

Let us know if you need some help putting together a comprehensive Estate Plan and will to ensure your loved ones are well cared for… just in case.