The Importance of Preparing a Will

Inheritance Tax

Your family could be liable to pay huge amounts of inheritance tax (IHT) on your estate if there’s no Will. There’s no tax to pay on an estate left to a spouse, and none for any children’s inheritance if you leave them under £325,000 each. If you have no spouse or children, the family member who receives your estate could pay tax. Knowing the thresholds for IHT can help you continue to provide for your spouse and children. Leaving a Will ensures that your unmarried spouse is also cared for and lets them avoid costly legal help to get the inheritance they deserve. Ensure that inheriting from you costs as little as possible.

Division of Assets

During their time grieving, one of the last concerns your loved ones will want to deal with is which of your assets belong to who. Items of major sentimental value to one person may have no meaning to another. If no Will is left, your spouse (wife, husband or civil partner) will receive all your belongings. As an example, say you wish to pass down cherished family heirlooms. You may assume that your partner will comply with your wishes and make sure that the right items get to the right people, but, you could be leaving your children or others who you want to benefit with nothing.  Nobody wants to deal with this issue when already having to grieve. The only way to avoid putting your family through trauma such as this is to express your wishes in a Will.

Disputes

You may expect that after your death everyone will amicably discuss a division of assets.

Sadly, this often isn’t the case. Family members often feel as if a Will (or lack of one) is unfair towards them and may contest it.

Fights like these can tear families apart. If you left no Will your children, grandchildren, brothers, sisters and parents may not receive anything. In life, you may have promised your child an item, such as a piece of jewellery, but you now have no way of ensuring that this wish will be carried out.

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Funeral Wishes

Contrary to belief, you shouldn’t include your wishes for how you want your funeral carried out within your Will. By the time your Will is read and executed, your funeral will likely be over. Instead, talk to your loved ones about this, and include written instructions for the event in a separate document. Ultimately, you have no say in the way your funeral and burial are conducted. However, most families follow the wishes of the deceased.

Executor of Estate

You can include other stipulations in your Will which must be adhered to. While writing your Will, appoint an Executor. Unlike the witnesses who sign off on your Will, your Executor can be an heir or beneficiary, for example, a partner or offspring. Money separate from an Executor’s inheritance can be set aside for the expenses incurred while sorting out your estate. Your Executor could be looking at 70-100 hours of work. If you leave no Will, a person you didn’t appoint could end up overseeing distributing your assets. This could negatively impact your family as this person may not be prepared to do the job or may do it improperly which could cost thousands. https://thewillmaker.co.uk/probate-explained/

Children

One of the most important wishes you need to voice in your Will is what happens to your children when you die. If no Will is left, then the authorities will decide where your children go. This may be against your wishes due to family issues, parenting styles and best interest of the children. Authorities may only look at who has a house and income large enough to support your minor offspring. They may not consider how this will impact the family. Similarly, a partner you are not married to may not be granted guardianship, which could be devastating for everyone. It’s important to set out exactly who you want to raise your children and discuss this with them.  https://thewillmaker.co.uk/what-happens-to-my-children-if-i-die/

Pets

An overlooked aspect when writing Wills are pets and animals. If you were to die unexpectedly, your pet may end up in a shelter or a rescue, or with family members who never wanted an animal. It’s important to make sure that your wishes are known on this matter, and that you make decisions based on the best interests of your pet.

If you have a spouse and children

1. The first £250,000 of your estate and any possessions you have go to your spouse
2. Half of the rest of the estate after your spouse receives their £250,000 goes to your children.
3. The other half also goes to your spouse.

If you have a spouse but no children

1. Your spouse will inherit your entire estate
2. Remember, you could be separated from your spouse and they may still receive your estate.

If you have children but no spouse

1. The whole estate will be received by your child/ren
2. If you have multiple children, the assets will be divided equally regardless of personal circumstance. (No provision for Disabled children)

Order of Inheritance

In all cases of a person dying with no spouse, your family will inherit the estate in this order:

1. Biological and adopted children
2. Grandchild (child of your deceased child)
3. Parents
4. Brothers and sisters
5. Nieces and nephews
6. Half brothers and sisters
7. Children of half brothers and sisters
8. Grandparents
9. Aunts and uncles
10. Cousins
11. Half aunts and uncles
12. Half cousins

If there are no surviving blood relatives, your estate will be awarded to the Crown. In cases such as these, many people are not considered such as close friends, carers and common-law partners.

You can avoid this by writing even a simple Will which explicitly identifies people you don’t wish to receive anything. You can exclude ex-partners, disowned children and estranged family members, as well as including any common-law partners. (What Happens to my estate if I do not leave a will?)

What if I’m ok with the order of Intestacy?

While you might be happy not writing a Will as the intestacy rules align with your personal wishes, this could hurt your family.

You won’t be able to leave specific items to people, as all possessions will go to your spouse or children. You also can’t leave money to charities or put funds into trusts for loved ones which could strife or upset within the family.

People you may have wanted to give an inheritance to will be left out, as the list gives nothing to friends, carers or unmarried partners. Don’t assume that everything will be divided up in accordance with your wishes when you die – Book your free consultation

Sideways Dis-Inheritance

One of the devastating results of having a poorly written Will or no Will at all is your family experiencing sideways-disinheritance.

How devastated would you be if your children received nothing after your death, and what should have been theirs went to a stranger? It’s a frighteningly real possibility.

As a quick explanation, say you leave your estate to your spouse if you die without a Will. They may remarry or enter a new civil partnership. If they die and leave their estate to their new spouse, which now includes your estate, this leaves your children out of the picture. When the new spouse dies they may leave their estate to their children. Your children have nothing, and a stranger’s children have your estate. How do you avoid this?

You can still have your spouse continue to live in your house after you die. Indicate that you are granting your spouse a lifetime trust on the property. This means that upon their death, your children gain ownership.

Ensuring your children get their inheritance

Another issue is that if you remarry, your new spouse would gain the estate. You can use the same steps as above to make sure that the estate goes to your biological children when your spouse dies and not any stepchildren. You can read more about Sideways Dis-Inheritance.