Estate Planning – good and bad news
We should all have a will – to make it easier for those left behind, to ensure assets are distributed according to the deceased’s wishes and, for those with young children, to appoint guardians.
Some good news:
The much talked about increase in Probate fees was abandoned by the Government last October. This would have amounted to a ‘death tax’ of up to £6,000 on grieving families.
Probate costs remain at a flat application fee of £215, or £155 if a lawyer applies on your behalf.
The bad news:
Recent research has revealed that 54% of UK adults do not have a will, and nearly 60% of parents of young children do not have a valid will – meaning they either do not have one at all, or the will they do have is out of date.
If people die with no will, complex rules of intestacy will apply, and their estate may not be passed on to whom they would have wished. People such as unmarried partners (sometimes wrongly called ‘common-law’ partners), relations by marriage (e.g. stepchildren), close friends and carers will certainly not inherit anything.
A vast number of people also omit to review their will after key life events such as getting married, divorced, or becoming a parent. In the latter case this means that no plans are made with regards to guardianship or appointment of trustees to handle the inheritance money should both parents die whilst the children are below the age of 18.
More bad news:
A Government report indicates that nearly 75 percent of people think that their partners or close family members can automatically make decisions on their behalf if they are not able due to physical or mental illness (such as spending weeks in a coma in hospital after a car crash or suffering from dementia).
Only a Lasting Power of Attorney (LPA) appointing someone you trust, gives those appointed – also known as attorneys – the legal ability to make decisions on your behalf. There are two types of LPA’s: one covering health and welfare; the other covering property and financial affairs – they are two distinct documents, but you could appoint the same trusted people if you chose to.
So, here are some suggested actions for 2020:
- Check if you have a will, and if you do not, consider making one.
- If you have a will, check when it was last updated
- Does it still reflect your wishes?
- Are your beneficiaries up to date? Especially if you now have children, or have moved in with your (unmarried) partner
- Are you happy with the Executor(s) of your will?
- Give serious consideration to whom you would appoint as your attorney(s) – both for financial and welfare purposes – should you be unable to make decisions.
It may not be the most cheerful of topics, however putting this side of your affairs in order will give you and those you care about peace of mind. Estate planning is especially important with today’s complex family structures.
Whatever you decide to do, make sure that sure that you take sound advice so that all papers are drawn and witnessed properly, and that your will is legally binding and cannot be contested.
Do not hesitate to contact our Private Client Department if you need any assistance – tel: 020 7625 6003 or firstname.lastname@example.org