Every client we see says that they have meant to get around to making their Wills many times, often as many as 20. Lots of people think it is tempting fate but in reality, making a Will is just sensible financial planning to make sure your wishes are known and will be followed.
There are lots of good reasons to make a Will. Most people won’t be aware of how much they can achieve with a professionally written Will, so here are the top 5 reasons to make a Will: –
- To avoid intestacy
The Laws of Intestacy are the rules that apply if you don’t make a Will. In effect the state writes your Will for you. No-one wants that. Partners get nothing. Your wishes are ignored, in fact, they are not even known.
- To make sure your wishes are known and will be followed
With a Will you can set out your wishes relating to lots of important things, both big and small. You can choose guardians that you want for your children should the worst happen, rather than a Children’s home. You can also delay inheritance to a more sensible age than 18 so inheritances are not wasted. You can choose your own executors and trustees avoiding substantial probate fees. You can make gifts of money, for example to grandchildren and make gifts of specific items of sentimental value to specific loved ones, for example jewellery to you daughter or granddaughter.
- To protect your home (and other assets)
Once we drill down into people’s objectives they are usually: –
- To protect each other after first death
- To maximise the inheritance received by your chosen beneficiaries
- To obtain peace of mind that your wishes will be followed
- To make life easier for your loved ones in the future
There are two principal threats to your beneficiaries receiving the largest possible inheritance: .
- Long term care fees. Care fees can have a major impact because the capital limits are still only £23,250 (upper limit – above which all your income and assets, including your home, will be taken) and £14,250 (lower limit – the amount you could be left with).
- Sideways Disinheritance. This happens in a number of ways, largely by the way the law operates, for example re-marriage, joint property ownership, a new partner, having the wrong Will or no Will.
The way you own your home is critical to mitigating the impact of Care Fees and Sideways Disinheritance. As joint tenants you have no control but as tenants in common with an estate planning Will you can achieve all four objectives above.
- To protect your beneficiaries
Wills can also be used to protect people as well as assets. The simplest form of Will Trust is a Children’s Trust where an inheritance is delayed but money can be advanced for good reasons, for example beneficiaries’ education, maintenance or benefit between 18 and 25 years old. So funds would not be advanced if they want to buy a Ferrari, but beneficiaries could get a more sensible car! Discretionary trusts can protect Vulnerable Beneficiaries from loss of benefits, financial abuse and wasting their inheritance. A Discretionary Trust can also protect beneficiaries from losing an inheritance as a result of marriage and divorce, Inheritance Tax, financial difficulties and other disinheritance threats.
- Because making a Will is just sensible financial planning.
We all spend lots of time, effort and money building our wealth, but most of us spend very little time or effort or money in making sure our wealth is protected and will go to the right people at the right time.
Lots of people think making a Will is tempting fate but it is actually the other way around – not making a Will is tempting fate because everything is left to chance. As a commitment to your family’s future why not take time for a quick chat to find out more about the options available to you and your specific circumstances.
Our “no-obligation” consultations are designed to help you: –
- Identify your objectives
- Review your circumstances
- Go through all your options
- Make informed decisions about these very important matters
There is literally nothing to lose and everything to gain. Even if you have a Will it should be reviewed every 3-5 years. There may have been changes in your financial or personal circumstances and the law has changed with regard to Care Fees and Inheritance Tax in the last few years.
Having a Will is very important, but having the right Will is absolutely vital if your wishes are to be followed. And reviewing your Will regularly is important to make sure it is still up-to-date and fit for purpose.
Article by Paul Dodsworth FCCA, FIPW, TEP, Managing Director, Estate Planning Solutions
For more information about wills and an introduction to Paul please contact your personal adviser at Suttons or call us on 0161 969 1703 or email [email protected]