Wills and Estate Management
If you are to really take financial control then you may need to consider having a will.
This can apply to people who need to reduce their outgoings or pay off expensive debts. However an important aspect of taking financial control is ensuring your family are financially protected in the event of your death.
This may be achieved by making a Will but many people assume that they do not have enough money to leave to anyone so why bother.
Who needs a will?
It is estimated that 70% of people in the UK do not have a Will, some of the reasons that people don't get them may include:
- People assume that their estate will pass automatically to their spouse
- The inconvenience of finding and visiting a Solicitor
- Assuming the costs will be high
- A lack of understanding about what is involved
- They never get round to it!
The absence of a Will could mean what?
- Surviving family members can often be left financially insecure simply because the deceased person did not make a Will.
- The Intestacy laws often mean that the estate was not distributed in the way the deceased intended.
A Will goes a long way to alleviate these problems and allows you to direct what will happen in a number of circumstances such as:
- You appoint trusted relatives or friends to administer the estate
- Guardians who know you and your family can be appointed to take care of children This can avoid the need for the State to intervene.
- Gifts of money or possessions can be made to relatives and friends
- Family pets can be taken care of
- Funeral wishes can be expressed
When making a Will it is a good time to consider what you want to happen in the event that you become mentally incapacitated and unable to handle your own affairs. This is handled by establishing an Enduring Power of Attorney.
This document ensures that someone you trust can handle your financial affairs as if they were you and you can continue to live without the State becoming involved.
I made a Will 10 years ago so that's all I need!
It is important that a Will is reviewed regularly - every 3 years is ideal.
However if circumstances change significantly then your Will should be reviewed at that time.
The events that materially affect the validity of an existing Will include:
- Getting married or divorced
- Birth of children or grandchildren
- Death of a Beneficiary, Guardian or Executor under the will
- Changes to the Executors of Guardians
- Disposal of assets that are specified in the Will
- The Acquisition of new assets
- Changes in the Tax Laws
- Change of Mind
It is never too late to make a will
Some people think that they have reached old age and that making a Will is not necessary.
The late Queen Mother made her first will when she was 93 years of age and the impact was that she saved £43 million pounds in Inheritance Tax!
Whilst the saving you make may not be as high as that, the use of a Will coupled with proper advice regarding your financial position can make a lot of difference to your family and ensure that any tax that is paid is the very least amount.