WHY MAKE A WILL?

Would you rather leave things to chance?

Your Will is one of the most important documents you will ever sign. If you do not make a Will, your property could end up in the hands of people you have no wish to benefit. Also, you might have failed to take advantage of the tax planning opportunities which often become apparent when making a Will.

Most people think that without a Will, everything passes automatically to the surviving spouse. This is not necessarily so and will depend upon your circumstances.

Whilst a “home-made” will or a will purchased from a shop, if completed and signed properly can still be valid, if it is incorrectly completed or signed it may be invalid and end up costing you or your beneficiaries more than instructing a professional to complete your will at the outset.

It is therefore important that your Will should be drafted so that it sets out your wishes accurately. Outlined below are some important points as to why it is important to make a Will: -

1. YOU CHOOSE WHO RECEIVES YOUR ESTATE

Some people have very strong views as to who should and should not receive their money and property. Gifts can be made to spouses, partners, children, friends and charities.

Without a Will, the law dictates who will receive your estate

2. YOU DECIDE WHO WILL LOOK AFTER YOUR ESTATE

You choose who will act as your Executors and Trustees. You may wish long-standing friends or professional advisers to act alongside loved ones to ease the burden. You may not want your family to deal with your estate.

Those who inherit under intestacy will also be responsible for administering your estate.

3. YOU DECIDE WHO WILL LOOK AFTER YOUR MINOR CHILDREN

Especially important for separated or divorced parents, you may wish to choose who should look after your children.

If no surviving parent, social services will consider whoever they think appropriate to act as guardian, failing which your children may be placed into foster care.

4. YOU CAN INDICATE YOUR PREFERRED FUNERAL WISHES

It can be of great help to your loved ones to know whether you would prefer burial or cremation as such a decision can cause much upset during the early stages of bereavement.

The decision as to your funeral is made by those family members left behind. Your long-standing partner may be excluded in these decisions unless you appoint them.

5. YOU CHOOSE WHO WILL RUN YOUR BUSINESS AFFAIRS

Your Will can ensure that you nominate the right people for the task in order to safeguard your business interests, especially if they are to provide an income to a surviving spouse.

Your family may not wish to run your business and your business partners may not approve of their involvement.

6. YOU CAN MAKE FULL USE OF TAX SAVING MEASURES

Your Will can include the use of a Nil Rate Band legacy either as an outright gift or as part of a discretionary trust, utilising your personal allowance for Inheritance Tax.

For married couples, using both personal allowances can save considerable amounts of tax which may not be possible under intestacy.

7. YOU CHOOSE AT WHAT AGE YOUR CHILDREN INHERIT

Your children cannot receive their entitlement until they reach the age of 18. However, it may be prudent to arrange payment in stages, perhaps at 18, 21 and 25. Before they reach these ages, your Trustees can be given a discretion to advance money to your children for education and maintenance.

Under intestacy, your children will inherit at 18 irrespective of their circumstances and your wishes.

8. YOU CAN CREATE A LIFE INTEREST IN PART OF YOUR ESTATE

Life interest gifts are very flexible and are especially popular with people who have married more than once. You can allow a beneficiary (doesn’t have to be a spouse) to enjoy an income or to live in your property for the rest of their life, but on their death the assets pass to your chosen beneficiaries, rather than theirs. You can also stipulate that the life interest come to an end if the beneficiary cohabits or remarries.

Whilst the Intestacy Rules provide for a partial life interest for a surviving spouse where there are children, such a provision is not available for other kinds of beneficiaries, for example siblings or aged parents. In addition, a life interest created by intestacy will more often than not cause a conflict of interest between the surviving spouse and children. A surviving spouse may resent the fact that they are beholden to trustees and the children, especially if they are stepchildren. Stepchildren may resent the fact that they will have to wait to receive their inheritance. A Will can stipulate the terms of a life interest, whereas under intestacy there are no clear rules.

HAVE THE PEACE OF MIND THAT YOUR LOVED ONES WILL NOT BE TROUBLED BY THE COMPLEXITY OR EXPENSE THAT MIGHT RESULT FROM INTESTACY – CHOOSE TO MAKE A WILL.

These notes are for general guidance only. The legal position may alter from time to time. You should seek advice on your individual circumstances before making any decisions. We cannot take responsibility for action solely based on these guidelines.