Having a will in place is the best way to ensure that your loved ones are looked after properly when you’re no longer here and that your estate is handled according to your wishes. You may have put off drawing up a will as it can seem complicated. However, a protection consultant can help you with the process to make it as easy as possible.
A will is a legal document that leaves clear instructions in the event of your death as to what should happen with your estate. Far from just including your home and possessions, it can extend to what happens to your children, your pets, your business, how you would like your funeral to be conducted and more. The pandemic highlighted our vulnerability and, if you haven’t already, you should consider making one. If you don’t have a will in place, your estate will be divided according to the rules of intestacy. This means you won’t have any control over what happens to it.
What is included in your estate?
Your estate includes everything you own whether solely in your name or in joint names. This can include your property, cash, investments, your car, personal items (such as jewellery), your pension fund, insurance funds and digital assets, such as a website, purchases made via iTunes and a PayPal account.
What happens to your estate without a valid will in place?
As mentioned above, the rules of intestacy will apply. These state that the only beneficiaries of your estate can be a married or civil partner and close relatives. If you have a partner but are not married or in a civil partnership, they won’t be entitled to an inheritance. This is regardless of how long you’ve lived with each other or whether you have children. The intestacy rules also state that:
- If you have a partner (married or civil) and no children, your partner will inherit your entire estate and personal possessions.
- If you have a partner (married or civil) and children, your partner will inherit a minimum of £250,000 of your estate plus your personal possessions. They will also inherit half of the rest of your estate and your children will inherit the other half.
- If your partner is deceased and you have children, your children will inherit equal divisions of everything.
- If you have neither a partner nor children, your estate may be inherited by parents, siblings, nephews and nieces.
If your estate has to be dealt with according to the rules of intestacy, it may not be divided as you wish. The process will also take longer, delaying when your possessions and assets are passed to your beneficiaries. This emphasises the importance of having a will if you have dependants, own a property in Bexleyheath, own a business in Pimlico or have savings, investments and insurance policies in place. With your wishes expressly laid out in a will, you can be certain that your family members will be looked after and that your assets will be left to the beneficiaries you’ve specified.
Other reasons to make a will
If you don’t have a will – or have opted for a mirror will or a low-cost will – some other factors to be aware of are:
- The assets left to your children will increase their inheritance tax liability.
- The assets left to your children may be forfeited if they get divorced or go bankrupt.
- If your partner remarries after you have died, they can gain possession of your estate. This potentially leaves your children without an inheritance. This issue can escalate should they then divorce and your estate becomes divided in the settlement.
- The value of your home can be assessed by the government, culminating in its potential sale and the proceeds then being used to pay for the long-term care of an elderly partner.
Having a will in place also helps to mitigate your inheritance tax liability. How much is payable is based on the value of your estate and who your beneficiaries are. With careful planning, there are ways to reduce the inheritance tax bill. This ensures that more tax isn’t paid than is necessary.
Speak to an expert for assistance with making your will
You’ve worked hard for your assets and having a will in place ensures they’ll be given to your chosen beneficiaries when you die. With a valid will, you can have peace of mind that your loved ones will be looked after when you’re no longer here to take on that role. No matter how busy your lifestyle is or how complex your affairs are, it’s better to seek assistance from a mortgage and protection consultant in Kent, London or Edinburgh sooner rather than later to help you make a will.