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Time to talk

Discussing wills and trusts with adult children or dependents.

Wealth transfer has become an important issue for many families

today. Individuals with assets of any size should prepare for their eventual

transfer whilst making provision for any tax or legal consequences.


But more than half of parents (57%) haven’t spoken to their adult children about their Will, according to new research from Opinium. Nearly a quarter (24%) of the 2,000 adults surveyed haven’t discussed making a Will with their partner or spouse, while almost a third (31%) were unsure if they understood the long-term benefits of putting their assets into a trust or finalising a Will.


Long term finances


The survey also revealed one in two (49%) adults admit that talking about long-term finances, especially in the event of death, with family members is difficult. When it comes to discussing Wills and trusts with adult children or dependents,

over two-thirds (69%) of parents say they feel responsible for the financial wellbeing of their children if they were to pass away.


Despite this, 57% admitted they haven’t talked to their children about long-term finances, while nearly one in ten (9%) parents said they weren’t sure how to approach the topic. The survey finds 47% of people have their children down as a beneficiary of their Will – higher than other forms of support, such as a deposit for a house or flat (19%), a savings pot with regular contributions (16%), or covering the cost of transport, such as a car (15%).


Minimal Inheritance Tax


Parents and guardians should make formal arrangements so that, upon their death, the appropriate plans are in place to ensure the people they wish to benefit from their estate will do so, with the estate settled as quickly as possible and with minimal Inheritance Tax.


If there is no Will, the deceased’s estate will be distributed under the terms of law, which may not align with their loved one’s wishes. Receiving the right

professional advice and setting up a financial plan can ensure you are best able to look after your family when the time comes.


Giving peace of mind


With so many different options, it can be overwhelming.


The research found that two-thirds of adults (69%) understand the long-term benefits of finalising trusts and Wills, but that still leaves many who don’t. It’s important to have plans in place to protect your assets and loved ones, today and in the future.


It might be difficult to think about, but it ensures your wishes will be met, giving you peace of mind. The outcome of not having a Will or trust in place can be

costly – so knowing the difference between Wills and trusts, and putting them in place appropriately, can provide vital benefits.


Wealth & assets


When looking to leave assets to family members, Inheritance Tax is a key consideration. Effective estate planning can help in ensuring your wealth and assets go to your loved ones. By setting up a trust you can effectively put the money outside of your estate, which could be efficient for Inheritance Tax purposes.


Assets held within a trust do not usually form part of your estate upon death, provided that you live for seven years after placing the assets into trust. Therefore, it’s likely they won’t be liable to Inheritance Tax.


Understanding the options


Effective estate preservation planning could save a family a potential Inheritance Tax bill amounting to hundreds of thousands of pounds. Inheritance Tax planning has become more important than ever, following the government’s decision to freeze the £325,000 lifetime exemption until April 2028, with inflation eroding its value every year and subjecting more families to Inheritance Tax.


Over half of Britons (57%) believe it’s important to seek financial advice when it comes to longterm financial planning, which is absolutely right. Seeking advice from a professional ensures you fully understand the options available, and

recommendations are made in line with your requirements, giving you peace of mind..


Looking to pass on more of your wealth in the most tax efficient way?


We all have different objectives in life and need different strategies to help achieve them. We can help you build a strategy that provides financial support to your family and helps you pass on more of your wealth in the most tax-efficient way – please call us for more information.

 

The Financial Conduct Authority does not regulate Taxation, Trust advice or Will writing.


Trusts are a highly complex area of financial planning.


Information provided and any opinions expressed are for general guidance only and not personal to your circumstances, nor are they intended to provide specific advice.


Tax laws are subject to change and taxation will vary depending on individual circumstances.


Ancojada Limited trading as Ancojada Group is not authorised or regulated to provide financial advice.


All financial advice is provided by other regulated businesses.


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