There are many different reasons that prompt people to make their Last Will & Testament. Which of them applies to you?
Firstly, Let's consider what exactly a Will is?
A Will is a document that expresses what you want to happen to your assets when you die and it is the only method that legally ensures your wishes will be carried out.
What happens if you die without a Will?
Without a valid Will in place, your assets would pass under the Law of Intestacy which is a pre-determined process and may result in your assets passing to people, and in proportions, that you would not have chosen.
Furthermore, it is likely to take longer for your estate to be settled than if a Will had been made and it could also lead to greater costs and more tax payable.
During the period that it takes to complete the settlement of your estate, your beneficiaries will not be able to draw any money from your estate. This has the potential to cause genuine hardship and distress for your loved ones.
Finally, if there are no valid people to inherit, it could lead to your entire estate passing to the Government.
Reasons to make a Will
There are therefore many reasons why people make a Will:
Executors and Trustees
You choose who you wish to inherit your estate and you also choose who will ensure that those wishes are carried out when you die. People often choose members of their family or close friends to be an Executor or Trustee to their Will. Careful consideration should always be given here as to who is best suited to act for you. Some people may be better suited than others, dependant perhaps on their physical location or on any relevant skills they may have.
It might be appropriate to appoint a professional executor, especially where your estate is particularly complex, or if you wish to relieve the burden of dealing with your estate from grieving loved ones.
Guardians
If you have young children, it is highly advisable for your Will to appoint guardians in the event that both parents’ die.
If no person is named as a guardian then the courts will decide who should look after minor children and this may not be you would have wished for.
Married Couples
Married couples (and Civil Partners) shouldn’t assume that their spouse will receive all of their assets when they die. Under the Law of Intestacy, children could have a right to part of the estate.
Even if a Will had been created prior to marriage, unless a specific provision was made within the Will, it would have been revoked as soon as the couple became married.
Unmarried Couples
Unmarried couples do not have the same legal rights as those who are married. Under the Law of Intestacy an unmarried partner would not receive anything from your estate.
Inheritance Tax Planning
The Rules of Inheritance Tax have become more and more complex in recent years. Having a professionally drafted Will can ensure that tax on your estate is minimised, therefore maximising the amount inherited by your beneficiaries.
Protecting your Assets
It is a very popular wish when making a Will for beneficiaries to be protected from “unexpected disinheritance” of assets. This disinheritance could happen, for example, if a beneficiary gets married, divorced or becomes bankrupt after your death.
A Professionally drafted Will can include provisions for trusts to be set up on your death to ensure assets are protected against these potential eventualities.
Updating Your Will:
If you have an existing Will, it should be reviewed regularly, at least every three to five years.
It may need updating to reflect a number of changes in circumstances, for example;
· To include additional grandchildren as beneficiaries.
· To remove anyone who you no longer wish to benefit.
· If changes in the law mean the old Will is no longer the most efficient way to distribute assets.
So, you can see from all of the above that making a Will is vital to ensure that when you die, your wishes are carried out, and those who inherit your assets are the people you choose.
You will probably have also concluded that making a Will is a very complex area, and you would be right to think so. It is important therefore that you take proper, professional and qualified advice when making your Will.
Contact us now to set up a meeting to discuss making or reviewing your Will.
Ancojada Limited trading as Prosperitas Consult is not authorised or regulated to provide financial advice.
All financial advice is provided by other regulated businesses.
Advice on making Wills is not regulated by the Financial Conduct Authority.