This content is for information and inspiration purposes only. It should not be taken as financial or investment advice. To receive personalised, regulated financial advice please consult us here at Elmfield Financial Planning in Padiham, Burnley, Lancashire.
Interest in making a will seems to peak during crises. In April 2020, for instance, wills saw a 682% increase in interest as the first COVID-19 lockdown was imposed. Later in the year, wills interest soared again as the media reported on Boris Johnson’s admission to intensive care. Yet despite events over the last 18 months, many British people still do not have a will.
Below, our financial planning team here at Elmfield Financial Planning in Padiham, Burnley, Lancashire offers five reasons to make a will if you – or someone you know – does not yet have one. We hope you find this content useful. If you’d like to speak to an independent financial adviser then you can reach us via:
T: 01282 772938
#1 Peace of mind
Without a will, how can you be sure what will happen to your possessions after you die? If you die lacking a legal document specifying everything, your estate will be handled under the UK’s intestacy rules. These cannot be relied upon to distribute your assets in the way that you may want right now, and they may not arrive in the right hands. If you are unmarried but live with a partner, for instance, then your property will not pass to them automatically when you die.
#2 Stability for children
Your will is useful for specifying what you want to happen with your money, property and other personal effects. However, you can also use it to spell out what care for your children should look like. For children who are not yet adults (under-18s), you can use your will to identify their guardians. Without a will, a court will end up deciding their future. This may result in your child being placed into the care of someone you do not want.
#3 Everything is counted
Many people have complex estates with all sorts of assets which may be difficult for others to find, if they are not listed clearly in a will. Without this, might your surviving partner/spouse and children miss an important savings account, investment account, life insurance policy, pension pot or business interest? A will allows you to ensure nothing is missed when your estate is being dealt with for inheritance tax purposes.
#4 Easier for family
Your future passing will almost certainly be a difficult time for your family. Emotions run high and intense grief can make the whole process of administering your estate all the more challenging. This becomes all the more stressful and time-consuming when no will is in place, since it takes more time to list out your possessions and sort everything out. You can reduce this headache by creating a will, which would be doing your loved ones a huge favour.
Your will also has the benefit of helping to avoid family disputes – especially between children. When a parent dies and multiple children are involved, intense arguments can break out as they fight over possessions which each person assumed they were entitled to. Such disagreements can get very ugly due to the underlying grief everyone is feeling, and legal fees can quickly rack up as people press their claim – eating into the inheritance you hoped to give them. In the worst cases these can lead to siblings cutting each other off and no longer speaking to each other.
Spelling everything out clearly in your will can reduce the chances of this happening.
#5 IHT mitigation
In 2021-22, inheritance tax (IHT) is levied at 40% on the value of your estate over £325,000. This is setting aside any exemptions, such as the £175,000 nil rate band which applies when you pass on your family home to children. Making a will helps with planning your estate in a way that reduces unnecessary IHT when you die.
For instance, if you stipulate in your will that you want to leave everything to your wife/husband when you die, then he/she should inherit all of this without facing IHT. However, if there is no will in place then the UK’s intestacy rules state that your spouse will keep all of the assets (including property) up to £270,000. Half of the remainder is given to your spouse, and the rest is divided equally between your surviving children. From an IHT perspective, this may not be the best way to distribute your estate – leading to a less meaningful legacy.
If you have a will….
For those who already have a will in place, this is great news and hopefully this article leads you to a greater piece of mind that you made the right decision. However, if you have not updated it for a while, consider whether it needs a fresh look over to ensure it still reflects your wishes and circumstances (especially if these have changed). Also, think about whether a lasting power of attorney document may be of benefit to your financial plan if you do not already have one.
Invitation
If you are interested in starting a conversation about your own financial plan or investments, then we’d love to hear from you. Please contact us to arrange a free, no-commitment consultation with a member of our team here at Elmfield Financial Planning in Padiham, Burnley, Lancashire.
Reach us via:
T: 01282 772938
