Things to consider when making a Will
There are many things to consider when making a Will. Tax, for instance, in some cases can be an important one. But it should be remembered that a Will is an expression of wishes and therefore the person making the Will should consider the best interests of their closest ones to try and avoid, as much as possible, financial hardship at a difficult and emotional time. We share some key things to consider when making a Will.
Who should inherit?
It is particularly important for couples who are cohabiting but not married to have a Will. This is because the intestacy rules, which come in to play when a person dies without a valid Will in place, do not provide any protection for co-habitees and therefore they could find themselves at the mercy of the deceased’s family. It would possible for the co-habitee to make a claim under the Inheritance (Provision for Family and Dependants) Act 1975 but this could be costly and take some time.
Some people might want to ensure that a person doesn’t inherit from them such as an ex-spouse or other family member. A statement excluding them from benefitting can be included in the Will.
A person may be concerned that their surviving spouse may go on to remarry and therefore if they leave all their assets to their spouse their children may never inherit. This is a common concern for married couples with children. A simple solution is often to gift the assets on death to the children but give the spouse a life interest. This means that the children are the ultimate beneficiary’s, but the surviving spouse is provided for as long as she lives.
Consider your estate
To aid the decision process, it’s helpful to have a list of assets including sentimental items to help decide where they should go. It’s common for people to leave cash legacies to family members or charities in their Will but if there is not enough money in the bank then potentially another asset in their estate would need to be sold to satisfy that legacy. This could be an asset that the deceased may have preferred to keep in tact for another family member. Having a list of assets at the drafting stage should help highlight these issues so that the person making the Will can make the best decision.
A person should also understand what inheritance tax exposure they have as strategies could be put in place to minimise and in some cases eliminate it.
When making a Will a person is required to pick Executors. Part of an Executors responsibilities are to locate and identify the deceased’s persons assets and liabilities, determine the beneficiaries, in some cases apply for a grant of Probate, and arrange for the distribution of the estate in accordance with the terms of the Will.
This role carry’s great responsibility and can be time consuming. It is important a person speaks to those people they wish to appoint to ensure they are happy to act before proceeding with the Will. A named Executor can refuse to act and if there are no other named executors then it may fall to the beneficiaries to carry out these tasks which may be desirable if they are not coping with the death of the deceased.
Appointing an independent or professional executor should be considered if the person is concerned there could be a family fall out or they do not believe they know a person suitable for the position. But this will bring an additional cost to the estate.
Children under 18
If a person has parental responsibility for a child or children then it is important to appoint a guardian(s) for those children should they die before the child/children reach 18. This will only come into effect if there is no other living person who has parental responsibility for them also such as their other parent. If a guardian appointment is not made via a Will then your children could go into foster care while the court decides who they will appoint as the guardian(s).
If a person does appoint guardians, then they should consider whether its appropriate to leave some of their estate to them, so they are not burdened financially from taking on the responsibility. Again, it is important that they get agreement from them that they would be prepared to act.
Ask a specialist to write your Will
A professional will-writer will guide a person through the will writing process and highlight areas that need further consideration to ensure that your Will reflects their wishes but they understand the impact of their decisions.
Finch Tax are members of the Institute of Professional Will Writers, as well as Chartered Tax Advisers and STEP Affiliate. We will work with you and provide the necessary advice to ensure that your Will expresses your wishes clearly and in the most tax efficient manner. Contact us for a non-obligation discussion.