Making a Will

Ensuring you have a valid Will in place is a fundamental part of estate preservation planning and will help ensure that in the event the worst were to happen, your assets – financial wealth or possessions – are distributed to the right beneficiaries and in an orderly fashion.

Peace of Mind and Certainty

A Will not only provides peace of mind that the correct beneficiaries benefit from any estate distribution, but also that it is done as efficiently as possible. Ensuring your house is in order by having the right legal instructions can take away much of the emotional and financial pressure at a very difficult time. Taking the first step is always the most difficult but puts you as the benefactor in the driving seat.

Having a Will in place can help reduce the amount of Inheritance Tax that might be payable on the value of the property and money you leave behind. Writing a Will is especially important if you have children or other family who depend on you financially – or if you want to leave something to people or an organisation outside your immediate family.

If you die without a valid Will in place, you will be dying intestate and your estate will pass to those entitled under the rules of intestacy. This could have unwanted consequences, and your estate could pass to unintended beneficiaries and leave your loved ones in a very difficult situation at what is an already emotionally challenging time.

Unmarried Partners Risk IHT Liability

Unmarried partners, including same-sex couples who don’t have a registered civil partnership, have no right to inherit if there is no Will in place. One of the main reasons for drawing up a Will in this situation, is to mitigate a potential Inheritance Tax liability.
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Statutory Rules of Intestacy

If you die without making a Will, the distribution of your estate becomes subject to the statutory rules of intestacy (where a person resides also determines how their property is distributed upon their death, which includes any bank accounts, securities, property and other assets they own at the time of death). This can easily lead to some unfortunate and unintended consequences – such as beneficiaries that you would otherwise have wanted to benefit, left with a substantially smaller portion, or disinherited altogether.

Making a Will provides certainty and is the only way for you to indicate whom you want to benefit from your estate. Failure to act in this area could easily compromise the long-term financial security of the family.

Key Implications of Dying Without a Will

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An unmarried partner doesn’t automatically inherit anything and may need to go to court to claim for a share of the deceased’s assets.

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A spouse or registered civil partner from whom a person is separated, but not divorced, still has rights to inherit from them.

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If the deceased person has no close family, more distant relatives may inherit.

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Assets people expected to pass entirely to their spouse or registered civil partner may have to be shared with children.

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Friends, charities and other organisations the person may have wanted to support will not receive anything.

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If the deceased person has no surviving relatives at all, their property and possessions may go to the Crown.

Ensuring Responsibility is With the Right People

Where there is no Will in place, relatives who inherit under the law of intestacy will normally be expected to administer the estate. They might not be the best people or even feel comfortable or confident in performing this role. Making a Will lets you decide the people who would be best for this task, and these will be named the Executors. If you don’t have family or trusted friends that are suitable or willing to be named as Executors, you can also appoint professionals such as a company – although this would normally involve some additional cost either initially or when it comes to performing the role.

Once a Will has been made, it is important you review this regularly, especially when there has been any changing of circumstances. Unmarried partners have no right to inherit under the intestacy rules, nor do stepchildren who haven’t been legally adopted by their stepparent. Given today’s complicated and changing family arrangements, Wills are often the only means of ensuring legacies for children of earlier relationships.

What You Will Need to Consider

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Who will be responsible for carrying out the instructions of the Will (the Executor/s)?

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Is there a need to nominate guardians to look after any children if you were to die before they turned 18?

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Who are the key people you would like to ensure are provided for and in what way?

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What gifts are to be left for family and friends - and how much should they receive?

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What provision needs to be taken to minimise any Inheritance Tax that might be due on death?

Preparing a Will

Before preparing a Will, you will also need to think about what possessions you are likely to have when you die. This will include properties, money, investments and even animals. Before an estate can be distributed among the beneficiaries, all debts, taxes, and the funeral expenses will need to be paid. Where you have a joint bank account, the money passes automatically to the other account holder, and you can’t leave it to someone else.
Estate assets may include:
  • A home and any other properties owned elsewhere.
  • Savings in bank and building society accounts.
  • Investments, such as stocks and shares, investment trusts, Individual Savings Accounts.
  • National Savings & Investments, such as Premium Bonds or savings certificates.
    Insurance, such as a life assurance or endowment policy.
  • Pension funds that include a lump sum payment on death.
  • Motor vehicles or caravans.
  • Jewellery, antiques and other personal belongings.
  • Furniture and other household contents.
Liabilities may include:
  • Mortgage(s)
  • Bank overdraft(s)
  • Loan(s)
  • Credit card balance(s)
  • Equity release
  • Utilities

Jointly Owned Property and Possessions

Owning property and other assets jointly can be a way of protecting your spouse or registered civil partner. For example, where joint bank accounts are held, the surviving partner will continue to have access to the money they need for day-to-day living without having to wait for Probate to be granted.

There are two ways that a person can own something jointly with someone else:

AS JOINT TENANTS (CALLED ‘JOINT OWNERS’ IN SCOTLAND)

Assets held this way means that Individuals jointly own the asset. When they die, the remaining owner(s) automatically inherits their share. A person cannot use their Will to leave their share to someone else.

 

AS TENANTS IN COMMON (CALLED ‘COMMON OWNERS’ IN SCOTLAND)

With tenants in common, each person will own their distinct share of the asset, which does not have to be equal. Within the Will, they can state who will inherit their share. For example, as tenants in common, a couple might use a Property Protection trust to ensure their share of the family home is ringfenced on death, for the ultimate benefit of their children. Their share of the home would be protected by being held in trust, in the event the surviving partner were to remarry of if they went into care in later life and needed to use up their assets to cover the costs.

Need Some Help?

If you are yet to make a Will or have an older Will that is need of updating, then it’s important not to delay this any longer. As we have discussed, there are several potentially unintended and/ or harmful consequences for you and your loved ones – and at a time when simply dealing with the emotional aspect of losing a loved one can be overwhelming. Please contact us today to discuss addressing your Will or any other estate planning requirements.
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First Equitable, 2nd Floor, 1 Old Hall Street, Liverpool, L3 9HF.

Authorised and Regulated by the Financial Conduct Authority.

Estate planning and the provision of Wills are not regulated by the Financial Conduct Authority.

On behalf of APS Legal & Associates Ltd, Head office: Worksop Turbine Innovation Centre, Shireoaks Triangle Business Park, Coach Close, Worksop, Nottinghamshire, S81 8AP. APS Legal & Associates is a member of the Institute of Professional Willwriters. APS Legal & Associates complies with the Trading Standards Institute Approved IPW Code of Practice
First Equitable (UK) Ltd (Comp. No. 09910371): Registered Office: 20-22 Wenlock Road, London, N1 7GU.  First Equitable (UK) Ltd is authorised and regulated by the Financial Conduct Authority FRN:782577.

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