DO I REALLY NEED A WILL?

Any person over 18 can make a will but people often associate making a will with getting older or when you have reached a stage in life when you have more assets. That’s often when people do indeed think about making a will but there are excellent reasons for making a will at other life stages.

YOU’RE SINGLE

Even if you’re single you’ll want to have a say in how your estate is managed if the worst happens. You may have specific ideas about who could or should benefit from your estate: parents, siblings, nephews or nieces, friends or favourite charities or other causes close to your heart.
 

YOU’RE MARRIED

If you don’t have a will then the Intestacy Rules do step in to make sure your spouse and children receive something after you die but the formula used rarely gives people the outcome they would choose for themselves, but it’s not tailored to your circumstances or your family in any meaningful way. Unfortunately, the process is also longer and more expensive for the people you leave behind to deal with and can leave them struggling until they can legally access your estate funds at what will be the worst possible time.

YOU’RE A COHABITEE

If you’re not married or in a civil partnership, then your partner will have no automatic right to inherit from your estate if you die without leaving a will. This has been the cause of much distress over the years. There is scope to make an application to court under the Inheritance (Provision for Family and Dependants) Act 1975, but it’s not automatic, there are conditions that must be met, and it still involves the delay, expense and uncertainty of court action at a time when your loved ones could most do without it. Making a will is the simplest way to avoid these problems.

YOU’RE A PARENT

As a parent you should consider who you would like to look after your children in the event of your death. If your spouse is alive and has parental responsibility, then they will keep on looking after your children. However, where one parent has already died or where unmarried parents are living together it’s not always straightforward and will probably involve the courts deciding for you. A valid will nominating guardians is invaluable in such cases. If no one knows what you would have wanted, the Court will decide on the future of your children, and it may not be what you or your children would have chosen for yourselves.

YOU’RE A BUSINESS OWNER

As a business owner you may have clear ideas on what you would like to happen after you die. Unfortunately, without a will what will happen to your business may not be clear at all. The process of making a will is  a good opportunity to consider the impact of Inheritance Tax on the business when you've gone. There are a number of exemptions and reliefs available to reduce or even remove the Inheritance Tax burden and  you'll want the peace of mind of knowing whether these apply to your business or, if not, establish what steps you can take to reduce the impact with enough time to put them in place.

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Sometimes, we know that whilst we may wish for all our family to benefit financially from the business, the running or disposal of a business may not be for everybody. Perhaps you’d like to nominate specific individuals or even professionals to take care of the business side of your affairs whilst your personal estate is managed by other family members or individuals. A will can appoint separate business executors to handle your business assets and personal executors to handle the rest of your estate however you decide your loved ones should benefit financially.

A similar principle applies if you have art, literary or other specialist assets or collections. If you believe that your estate would benefit from it, you can appoint separate literary, artistic or other specialist executors that could provide specific knowledge, skills and experience in those elements of your estate for the greater good of your beneficiaries.

YOU’RE RETIRED

If you don’t have a will then it’s definitely a good time to make one. Whether you have a family or not, you probably would like to make sure that your estate is managed according to your wishes. If you’re part of a couple, you’ll want to make sure that your partner is well taken care after you’ve gone and if you have children and grandchildren then you’ll want to consider what you may want to do for them. If you haven’t done so already, then now is also the time to think seriously about Inheritance Tax and making the most of your assets.

YOU ALREADY HAVE A WILL

A well written and up to date will gives you and your family peace of mind and hopefully will make the most of your estate from a tax perspective whilst giving you what you need to have the life you want and have worked hard for.  But if it’s been a few years since you made your will then it’s a good time to have your existing will reviewed and see whether you need to revise it or indeed make a new one. Personal and family circumstances can change dramatically over the years from new children and grandchildren to marriages, divorces etc.

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The laws around inheritance, inheritance tax, allowances and exemptions are subject to change and have changed in a few dramatic and potentially consequential ways just in the last few years. We recommend you have a good look at your will every couple of years and every time there’s a material change in your or your family’s circumstances. If your will is more than 10 years old, then it’s definitely time for a review.

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A CAUTIONARY NOTE ON "DISCOUNT" WILLS

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Some banks, building societies and other will writing services offer cut price wills which at face value appear to offer very good value for money. Unfortunately, what they may often produce may be very simple wills following one of a handful of set templates rather than a bespoke legal document tailored to your exact and specific needs. They may be written by poorly qualified and inexperienced staff with just a few days training and the risk is that they contain critical legal weaknesses that may go unnoticed by the inexperienced eye. This could affect how your wishes are put into practice or may even result in your will failing dramatically in some important respect. To make matters worse they may not take full account of your inheritance tax position in all but the very simplest of cases. With Inheritance Tax at 40% every extra £10,000 of your estate that is deemed chargeable could cost an extra £4,000 in tax, so not having a full picture could be very expensive indeed. 

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Even if the will is adequate, the real sting in the tail is that the low price is normally offered on the basis of appointing that bank, company or institution as your executor, for which they will charge and will often do so handsomely. There have been well documented cases where estates have been charged four, five or six times or more than a qualified probate practitioner would cost. Even relatively modest estates with estates of no more than £500,000 have been charged in excess of £20,000 in probate costs by banks and other institutions where a reputable probate practititoner would have charged no more than £4-5,000. A common approach is to charge a set fee of between £1,500 - £2,500 plus a percentage of the value of the value of the estate (over the years we've seen rates of between 2.5% to 5%). A discount will may seem like good value, but even for the simplest and most modest of estates, it is usually anything but.      

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We never even suggest being named as executors. In fact, where clients have no family or friends that they wish to appoint we recommend appointing an independent firm of low cost solicitors or accountants with reasonable, clear and transparent pricing policies, to give you peace of mind that your estate won't be subject to exorbitant fees after you've gone. We work closely with solicitors practices that we know and trust, so if you really are stuck, we can offer some recommendations. 

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