No will? No way!

According to the National Consumer Council over 27 million people in England and Wales do not have a will. Here is some advice if you are one of those unwise individuals...

Once you are dead, or too infirm, you will have no say in how your estate - that is the value of all your possessions - is distributed. Instead, there are statutory rules called the intestacy rules that determine who gets what.

Have you really worked so hard, planned so carefully, invested so wisely, spent so diligently, or simply been lucky, just to have your accumulated wealth administered by outdated and arbitrary rules?

No will means...

If you don’t make a will, it means that:

• You can’t reward people whose kindness, loyalty and friendship has meant so much to you;
• People who you don’t want to benefit may get part of your estate;
• Your family will face an expensive, divisive and unpleasant period attempting to sort out your affairs;
• You will not get appropriate legal and financial advice on reducing inheritance and other tax;
• Your partner’s family (yes, the in-laws) could get a significant share of your wealth;
• If you are in a same sex relationship, your partner will lose out;
• Your favourite charities will not receive a legacy.

Partners do not inherit automatically

Many married couples or civil partners assume that if one of them dies, all their assets will automatically pass to the surviving spouse or partner.

However, automatic inheritance will occur only if the couple hold their assets in joint names.

A married couple’s largest asset is normally the family home, and unless it is jointly owned by the couple as 'joint tenants', the intestacy rules will apply in the absence of a complete and valid will.

Unmarried couples who die without valid wills are even more at risk because the surviving partner may be cut out entirely under the intestacy rules.

What intestacy means

If a husband/wife/civil partner dies leaving a surviving spouse and children, the intestacy rules state that the surviving spouse is entitled to:

• all the deceased spouse’s personal chattels (paintings, cars, jewellery etc);
• a cash legacy of £125,000;
• a 'life interest' (the right to income only) from half of the value of the estate (the residue) - which might include the family home.

The children will receive half the residue outright at the age of 18 and the other half after the end of the spouse’s life.

If there are no children, the intestacy rules state that the surviving spouse/civil partner is entitled to a cash legacy of £200,000 and half the residue (in addition to the personal possessions).

The deceased spouse’s parents (or if none, brothers and sisters) are entitled to the other half of the residue.

The unmarried partner receives nothing.

These are the intestacy rules, and once you are dead, there is little that can be done to alter them apart from expensive legal challenges which might not be successful, and are likely to be upsetting for the family.

Legal challenge?

The only recourse for the surviving spouse/civil partner is to make a court application for financial provision under the Inheritance (Provision for Family and Dependants Act) 1975.

However, there is no guarantee of success and the court will look primarily at financial needs. The wishes of the deceased, no matter how well evidenced, are not given much weight.

Even worse, an unmarried partner would receive nothing under the intestacy rules and unless the beneficiaries of the estate agree to vary these rules, a court application is the only recourse.  This often results in a heavy financial and emotional toll on the family.

Inheritance tax

In addition to ensuring that your wishes are fulfilled, a properly drafted will can also contain useful provisions for mitigating inheritance tax, particularly for married couples and civil partners.

This has become even more important following the changes introduced in the Finance Act 2006.

These changes to inheritance tax have affected not only those who leave assets in trust for their families during their lifetime, but also those who wish to leave assets in trust for younger offspring and other relatives under their wills.

So, don’t put it off making your will!

And do it properly...do not cut corners by going to unqualified will writers or buying off the shelf packs, because unless your family situation and financial affairs are very simple, you will need advice.

Solicitors up and down the country have examples of badly written wills that have cost families additional money to sort out, often causing family arguments and disputes.

If you don’t have a family solicitor who you trust to advise you on writing your will, go to the Law Society’s website and search under Wills and Probate to get details of suitably qualified solicitors in your area.

Then make your choice based on their experience; costs; recommendations; and personal chemistry including their ability to make complicated things simple.

A less expensive option is to use a reputable will writting company that uses qualified will writers. Heritage Will Writers is worth considering, and they will also store your will.

Update and register

You should update your will periodically to take account of different circumstances.  You should also register your will so that it doesn’t get lost, and is less likely to be challenged.

We recommend you put a copy of the most up-to-date version in your secure access Lifebox.

Ask your will writer to scan the final signed document and send it to your computer. You can then put it into your Lifebox.