When should I make a Will?

We often hear:

I’m too young to think about a Will

I don’t have time to make a Will

I don’t have anything to leave in my Will

My family know what I want to happen to my things when I die

I haven’t got around to sorting my Will yet but I know I should…

So, when should you put a Will in place?

Honestly, there is no right answer, no one size fits all! Everyone’s circumstances are different and so timing will be different for everyone.

Everyone’s lives take different paths and at different ages.

Below we have set out some of the milestones that making and reviewing your Will should be considered:

Buying your first property

When most people buy a property it is usually their most valuable asset, so when buying your first property it is important to consider (among all the other considerations when taking the plunge and buying your first property!) who your property, along with all your other possessions, should be left to.

Getting married

When you get married any previous Will that you may have is revoked and so is completely invalid. Once you are married, priorities change and so may your wishes in relation to your possessions so shortly after a marriage, or in contemplation of marriage, your Will should be reviewed.

If a Will is created in contemplation of a specified marriage then the said marriage will not revoke the Will, however any other marriage will revoke an existing Will.

Having a baby

Whether you have your own children, are fostering or adopting, having a child, or children, changes your life and means you are responsible for more than just yourself.

A growing family comes with so many considerations, worries and changes, not least the major question as to who you would want as the guardians of your children should you no longer be around. If guardians are not stated in a Will there is a possibility that the local authority may become involved and place the children in care whilst they decide who is best to look after your children… a worrying thought!!

Buying a new or bigger property

As we said, your property is usually your most valuable asset and so when buying any new property and with a change in financial circumstances, your Will should be a key consideration to ensure it still covers you and what you want to happen to your property and possessions.

Investing in buy-to-let properties or second homes

When investing in more property you should also consider your Will and taking advice in relation to the financial implications on the properties that you own, not only during your lifetime but also in relation to Inheritance Tax and what can be done to try and reduce this.

Investing in assets abroad

When you invest in assets abroad they may not be covered by your Will that has been made in the UK. When buying property or any other assets that will be kept in another country you should consider whether legal documentation is required in that country to cover your assets and your inheritance wishes.

Getting divorced

So, you’ve got divorced, do you still want your property and possessions to go to your former-spouse?

Although a marriage revokes a Will, a divorce doesn’t! It is worth reviewing your Will at the end of a marriage to ensure that what you want to happen is set out in your Will…it’s unlikely that you still want your former-spouse to inherit all of your worldly assets.

Getting re-married

As we have set out above, when you get married, whether for the first time or a subsequent marriage, any existing Will that you have in place is revoked.

You may also want to consider putting exclusions within your Will to state that any former-spouse should not benefit under your Will. You may also want to protect inheritance for children you may have had from preious relationships.

Owning a business

When you take the leap to start your own business, your financial situation will change again and you are potentially bringing more assets into your estate. Depending on the business setup you may need to take this into account within your Will. There are also tax reliefs you can utilise for businesses if planned properly.

Death of a Grandparent / Receipt of Inheritance

When you are a beneficiary under a loved one’s estate you are bringing more assets, and therefore more value, into your own estate. This is an important time to take account of the value of your estate and whether you should be taking steps to try and limit or reduce the amount of inheritance tax that may well be payable on your own estate.

Grandchildren

When you have grandchildren, as when you have children, your family is growing again and this is another generation that you may well wish to make specific provisions for within your Will.

Retirement

This is another milestone where your financial circumstances change. You may well be taking steps to consider your finances and assets and so this is the perfect opportunity to review your Will and provisions that you have set out.

Death of a Parent

This is a situation that none of us want to think about.

However, with more assets coming into your estate, the possibility of additional properties and valuables becoming your own, it is worth considering the tax implications and ensuring that your Will properly provides for your own loved ones in the way you want to.

There is never a right time to put a Will in place but as you can see there are many milestones throughout your lifetime in which your Will and future wishes should be considered and reviewed to ensure that your present Will does what you want it to.

To put a Will in place, is more simple than you think. It’s not an arduous task and we make it as simple as we possibly can.

If you would like to have a free chat about your Will, please contact us on info@TotalLegacyCare.co.uk or 01727 865 121

Leah Waller

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4th September 201823rd April 2020

Inheritance Tax: Record £5.2billion paid by UK in 2017/18

Inheritance Tax: Record £5.2billion paid by UK in 2017/18

With the Government collecting £5.2billion in Inheritance Tax last year, it is well worth considering whether your estate is liable for Inheritance Tax.

Although the record amount of Inheritance Tax paid in 2017/18 is nothing to be sniffed at, with only one in twenty estates actually paying Inheritance Tax there are ways of ensuring that your estate is not liable for Inheritance Tax, but in order to do so we must consider when Inheritance Tax is payable.

Inheritance Tax is payable upon death, where an estate exceeds the Nil Rate Band, at a rate of 40%. So, what is the Nil Rate Band?

The Nil Rate Band is a personal allowance, that each individual is able to gift, upon death, without attracting any Inheritance Tax.

The Nil Rate Band for 2018/19 (this is considered every April) is set at £325,000 per person, this may not seem like a lot considering the increase in property prices. However, in addition to the Nil Rate Band, if you are passing property to a direct descendant (a child, grandchild, great-grandchildren, step-children, adopted children or foster children) then you are entitled to claim the Residential Nil Rate Band. The Residential Nil Rate Band is currently set at £125,000.

If you are married and the estate is passed to the surviving spouse upon the death of the first spouse, then no Inheritance Tax is payable. Don’t worry, the deceased’s Nil Rate Band and Residential Nil Rate Band is not lost…

Upon the death of the surviving spouse, the Nil Rate Band and Residential Nil Rate Band can be combined to allow for the estate to pass to a direct descendant without attracting Inheritance Tax up to a value of £900,000 (in the 2018/19 tax year) by taking advantage of both spouses Nil Rate Band and Residential Nil Rate Band.

With the Government committed to increasing the Residential Nil Rate Band by £25,000 to April 2020, by the tax year 2020/21, an estate that includes a property and that is taking advantage of both spouses Nil Rate Band and Residential Nil Rate Band will be able to gift £1million to a direct descendant without attracting any Inheritance Tax.

If your estate is valued at over £2million then your use of the Residential Nil Rate Band attracts conditions and so if your estate is valued at over £2million then we will need to consider your exposure carefully to limit this where possible.

If you would like to have a free chat about your Inheritance Tax liability and planning for the future, please contact us on info@TotalLegacyCare.co.uk or 01727 865 121

Leah Waller

30th August 201823rd April 2020

The real cost of a free Will…

The real cost of a free Will...

We all know the saying “Nothing in life is free” but we are all enticed by a freebie. Sometimes these freebies end up costing us in ways we may not be aware.

From the 1990s to early 2000s, banks were providing a cheap or even free will-writing service and it is thought that as many as 1.5 million customers signed up to. Unbeknown to some of these customers, believing they were getting a great service from their bank, the banks wrote themselves in as Executors, entitling them to charge up to 2.5 percent of the estate value in legal fees to act as an Executor.

Now, if the Estate is valued at a modest £500,000 (and with house prices nowadays this could be a lot more), the fee could be £12,500. Depending on the complexities of the estate, Executors can carry out administration of the estate for far less of a fee and save around £10,000 on typical costs – these savings could be going to your beneficiaries. Unfortunately, it’s not just the banks that were at it, other will-writing providers and solicitors would also write themselves in as Executors.

Having someone you trust; a friend, family member or loved one as your Executor means that the beneficiaries you have put in place will get as much as possible from your estate without paying unwanted fees. Executors can ask for professional help and support if needed but it is (and should be) the right of the Executors to choose if they require professional help and how much assistance is required, not a right of the person writing the Will. If Executors need professional support to carry out the administration of an estate, they are always able to ask for assistance and it is often better to ask professionals that can give an estimate of the costs up front or a fixed fee.

What should you do if you have taken out a free Will?

Don’t panic! Just check over your Will and see who your Executors are and make sure there are no hidden surprises you may have previously been unaware of. If you are unsure, get a professional to review your Will for you.

If you do have unwanted Executors in your Will, you can write a new Will and state the Executors of your choice.

Your new Will revokes your previous Will, removing any Executors you may not wish to have involved. It’s always worth reviewing your Will on a regular basis, it is a working document that should be reviewed periodically as your wealth, life and family changes.

We are always happy to have a chat with you about who you may want to appoint as your Executors and even help with the discussion with Executors and answer any questions that they may have.

If you would like to have a free chat about your Will, please contact us on info@TotalLegacyCare.co.uk or 01727 865 121

Neil Barras-Smith

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28th August 201823rd April 2020

I need to put a Will in place but who do I choose as my Executors?

I need to put a Will in place but who do I choose as my Executors?

So, you have made the important decision to get a Will put in place and now you need to decide who is going to be your Executors.

An Executor is appointed in your Will and is responsible for collecting in and protecting your estate, including any property and assets that you own, and carry out the distribution of such items in accordance with your wishes.

Some of the key considerations when thinking about who to ask to be you Executor are:-

Who do you trust to act in a way that you direct?

Your Executor doesn’t have to have all the answers or know everything in relation to the legal aspects, financial or tax implications but they must be responsible enough to ask for help from the right people if and when that is required (this may be a solicitor, accountant, tax adviser or other specialist depending on the size and complexity of the estate and what assets you have).

Alternatively, you can appoint a professional or firm of professionals as your Executor, rather than a family member or friend, but these will usually charge a fee for their services.

Should more than one Executor be appointed?

A maximum number of four Executors can be appointed by the Probate Registry when a Grant of Probate is obtained upon death. This means that you can appoint up to four Executors to be responsible for the administration and dealing of your estate. Having more than one Executor relieves the burden, from just one person, of having sole responsibility and decision making powers, however, it may be necessary to consider that these Executors will have to make decisions together and so having four Executors may not be practical or possible.

Age of the Executor

This may seem like an obvious consideration but your appointed Executor will need to be alive, and capable of acting, at the time of your death to deal with your estate and so the age of your Executor, in comparison to your age, should be considered.

Some of the tasks that an Executor must perform (gathering in assets, making decisions in relation to property etc.) will require the Executor to be at least 18 years of age when carrying out their role.

Can I appoint a beneficiary as my Executor?

In short, YES! Often the best Executors are beneficiaries as they have an interest in collecting in all your assets efficiently as well as ensuring that everything is handled correctly and distributed in accordance with your wishes.

It goes without saying that your Executor should be trusted by you implicitly and if someone is a beneficiary under your Will then they are likely to possess the qualities you would like your Executor to possess.

Replacement Executors

Putting provisions in place for replacement Executors is a good idea to provide for circumstances where your first choice Executor is unable or unwilling to act at the time of your death. This will mean that your estate can still be dealt with by someone that you trust should your first choice not be a viable option.

When putting your Will in place, have a chat with your proposed Executors and let them know that you trust them implicitly and that is why you would love them to be an Executor. Having the conversation may well be difficult but it will save, what can be a shocking, surprise should anything happen to you and they are required to act.

An Executor has the right to refuse to act, if they are unwilling do so and so discussions at the time that a Will is put in place are important to overcome this. An Executor may be unable to act, through incapacity or if their death occurs before yours, however having conversations with your proposed Executors, when putting your Will in place, should prevent any surprises and limit the risk of them renouncing their obligations when the time comes.

We are always happy to have a chat with you about who you may want to appoint as your Executors and even help with the discussion with Executors and answer any questions that they may have.

If you would like to have a free chat about your Will, please contact us on

info@TotalLegacyCare.co.uk or 01727 865 121

Leah Waller

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Got a Question or want to book a FREE Consultation?

Tag: Executor