5 good reasons to make a will
Writing a Will may not be at the forefront of a lot of people’s minds, but it is one of the most important things you can do, not only to ensure your loved ones are provided for but to also give you the peace of mind of knowing that your wishes regarding your estate are in place.
Here are five good reasons to create or update your Will:
Avoid ‘The Nightmare’ of Intestacy
Dealing with an Estate without a Will is often described as a “nightmare” as it usually takes longer and is more complicated.
Firstly, your assets will be distributed according to the ‘intestacy rules’. These rules can sometimes leave those who should be provided for without an inheritance. A spouse may be left with much less than expected and unmarried couples are not entitled to anything at all. In extreme cases, your assets may even go to the Government.
Secondly, the entitlement to administer an intestate estate follows the same rules as the intestacy rules. ‘Strong characters’ can take over, which could mean that people you would rather not touch your private papers may end up taking charge. A Will gives you the opportunity to decide who you would like to sort out your affairs when you pass away.
A Fantastic Opportunity for Estate Planning
A Will is not just a list of who will inherit your estate. With some simple Estate Planning measures you can protect your assets from various risks and potentially save your family thousands of pounds:
Care Home Fees
Many people have to sell their property to pay for care, however, a carefully drawn Will can protect at least half of the value of your property from the risk of care home fees.
Inheritance Tax (IHT)
IHT is payable at a 40% rate on assets above £325,000. Many people feel that this is unfair as they have already paid tax when they earned the money. A well-drafted Will can considerably reduce the amount of IHT you pay.
Divorce or Bankruptcy
If any of your children go through divorce or bankruptcy, any money they inherit may be lost. A protective clause in your Will can make sure your money stays in the family.
If your spouse remarries after your death You may hope your spouse will meet a new companion following your death but how can you be sure the new partner won’t spend the inheritance you hoped would pass down to your children? A protective clause in your Will can address this risk.
Complicated families, such as children from a previous relationship
If you or your partner have children from a former relationship, you will want to make sure each other will be secure without risking your children losing out on their inheritance. We can draft a Will to make sure everyone’s interests are protected.
Make sure you qualify for the new IHT Allowance
Tax and succession law is complicated and fast-moving. The Government have recently introduced a new inheritance tax allowance for people passing on property to their direct descendants. This is called the Residence Nil Rate Band (RNRB).
There are important qualifying criteria for this new allowance, so your Will needs to be completely up to date to ensure you do not lose out on this tax break. Wills drafted before 2006 are particularly at risk of causing problems and should be reviewed as soon as possible.
Parents can nominate Guardians for their children
You can appoint guardians in your Will to take care of your children whilst they are still under the age of eighteen. This is important because otherwise, a Court may have to step in, possibly appointing someone who you would not have chosen for the role.
Your opportunity to write a ‘Letter of Wishes’
Even where there are few assets in an Estate, families sometimes fall out. We know of one case where a family even argued over a mop and bucket! Deciding who will keep your personal belongings is often the most difficult part of winding up an estate because of the sentimental value. A Letter of Wishes gives you the chance to set out which items are important to you, and who should have them. Some people even add a few personal words, which can be a great comfort to the family.
If you have any questions or would like advice on Estate Planning and writing your Will, please get in touch with our Private Client Department on 01273 956270 to discuss your queries further.