The last 12 months have made clear the importance of protecting ourselves and our families. One way to do this is through the things you leave behind when you are gone.
A will is the simplest way to make sure that your wishes are carried out after your death, and that your assets are distributed among the people you choose.
Which? confirm that will writing increased by over 600% during April 2020, at the start of the initial lockdown. However, according to a recent Law Society report, a year later 59% in the UK still don’t have a will.
Here are five reasons why you need one, and why you need to keep it up to date.
1. A will puts you in control
The unexpected can happen at any time, with serious ramifications for you and your family. Having a will in place is one way you can take back control.
Dying without a will in place, or dying “intestate”, means that you have no say over how your assets are distributed. Instead, the laws of intestacy determine how your estate is proportioned, and among who.
Blood-relatives and spouses will normally inherit under the laws of intestacy, but a cohabiting partner or stepchildren will not.
The only way you can stipulate where you want your money to go is through a will. Put one in place now and ensure it is up to date when life events mean your priorities change.
2. You can provide for those you care about
While the rules of intestacy set out a definite flowchart of who inherits in what circumstances, all families are different, and only you know where you want your money to go.
If you have children, stepchildren, or vulnerable adult relatives who are dependent on you, ensuring they are looked after once you are gone will be a priority.
You can use your will to name legal guardians as well as supplying funds for school fees or care.
3. Reduce stress, costs, and delays
The loss of a loved one is traumatic and stressful. Exizent’s recent Bereavement Index, as reported in the Independent, confirmed that dealing with a loved one’s finances causes mental health problems for 40% of the bereaved.
If you die intestate, there is no named executor, and one will need to be appointed. Depending on who is chosen, they may need to be insured, causing added and unnecessary expense, as well as delays.
Putting a will in place can make managing your estate easier and less expensive, helping to reduce stress for those you leave behind.
4. It is tax-efficient
Managing Inheritance Tax (IHT) is a vital part of your long-term financial plan. We can help with estate planning, so be sure to get in touch if you are worried about the liability you might leave behind.
The IHT rate is currently 40%. This is the amount of tax payable on the portion of your estate that exceeds the IHT threshold of £325,000.
Everything you leave to your spouse or civil partner is exempt from IHT, regardless of the size of your estate. There is no IHT to pay when you make certain exempted gifts during your lifetime and gifts to charities are also tax-free. You might use gifts to lower your liability.
The balance between living your desired lifestyle in retirement and leaving enough behind – but not too much – can be difficult.
At Boolers, we take a holistic view of your finances, helping you to understand your cash flow in later life, and decide how much you can afford to leave behind. This will allow you to put a will in place that aligns with your wishes while also being tax-efficient.
5. Peace of mind
Putting a will in place gives you peace of mind that your estate will be distributed in a way that aligns with your wishes, and without exposing your loved ones to unnecessary tax liabilities.
Knowing that your loved ones’ futures are secured will allow you to enjoy the present.
Remember too, though that priorities can change. Having a will in place is important, but it is equally necessary that it is up to date.
Big life events – births, deaths, and marriages, for example – could alter your priorities and require a change to your will. Be sure to review it regularly to ensure it still meets your needs.
Get in touch
Putting a will in place is the simplest way to ensure your wishes are carried out on death and that your loved ones are provided for after you are gone. It is only one part of the estate planning that Boolers can help you with.
From managing pension withdrawals to putting protection policies in place, as well as managing IHT, our experts are on hand.
If you would like to discuss any aspect of your estate planning, Boolers can help, so please contact us today.
Please note
The Financial Conduct Authority does not regulate estate planning, tax planning or will writing.
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