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Let’s talk about inheritance!

It’s clear that discussing what will happen to your estate when you die has always been emotionally difficult. It just doesn’t seem to happen, leaving many families unnecessarily financially vulnerable, and upset and confusion when people don’t inherit as they would expect to.

inheritanceThe number of people who have made plans for their estate when they die is surprisingly low, with only around 50% of adults in the UK having made a will.  This, according to a recent study, is despite the fact that 80% of people say they plan to leave an inheritance to someone, and 90% of people appear to be reliant on a future inheritance to pay off bills or fund their own retirement – or even to pay for the deceased’s funeral.  So, what is happening?  Are we just not talking to each other about the future?

It’s important to point out that if you don’t set out in a will what you want to happen to your estate when you die, it will be decided by the rules of intestacy. These rules state exactly who will inherit everything you own – and you may not like the results!  If you are married or in a civil partnership, you might think your spouse/civil partner will inherit all your estate, but that isn’t true if you also have children/grandchildren/great-grandchildren, when your spouse/civil partner will only inherit a percentage of your estate.   Conversely, if you want your children to inherit everything and not your spouse/civil partner, that will not happen without a will either.  Importantly, if you are estranged, but not divorced, your estate will be distributed in the same way as it would if you were still married – whether you want it to or not. Sadly, if you cohabit, your partner has no automatic entitlement to inherit without a will – although the Law Commission has recommended a change to this rule.

So, making a will is vital, but having conversations about what is in it is just as important, as your decisions could lead to unhappy, confused beneficiaries, family feuds and even unnecessary disputes if people are unaware of them.

Firstly, it should be noted that you cannot name executors without their permission, so you must ask them first.  Not doing so could lead to complications when it comes to carrying out your wishes and applying for probate if those chosen don’t want to act.

It is suggested in the recent report that, whilst only 17% of spouses expect to receive an inheritance from their other half, 67% of children are expecting to inherit from their parents. But what if you want to leave all of your estate to your spouse/civil partner or more (or all) of it to one child than another?  Will they understand if you haven’t discussed it with them? It could cause severe financial difficulties if someone is expecting a bigger inheritance than they get – or huge upset within the family. Equally, you should discuss any charity legacies or legacies to people that your family doesn’t know – it will be much easier for them to know about this now, rather than it be the cause of disputes when you die. If you do leave someone who would be expecting an inheritance out of your will, it would be best to leave a note within the will explaining why.

Discussion around inheritance and blended families is particularly important as it can be a cause of misunderstanding and grievance. Step-children are often treated unfairly.  Nationally, just under 50% of step-parents plan to exclude step-children from their will or treat them unfairly within it.  However, step-parents in Yorkshire and the Humber appear to have a fairer attitude, with 89% saying they have already made provision for step-children in their wills.

Inheritance

Anne Rogers

Anne Rogers, partner and head of Graysons’ private client team says:

“Making a will is not difficult but does take thought.  You might be concerned about inheritance tax and wish to discuss how this can be managed so that the amount of inheritance tax payable by your estate is reduced.  We can discuss how your beneficiaries can benefit from insurances and pensions, how your will can be written if have remarried, or even just talk about how you can be fair to everyone.  We are happy to discuss your wishes with you and your family to help ensure that everyone understands them.”

You have landed on this page as Watson Esam has merged with Graysons

You can read more about the merger here. Graysons will be pleased to help with your enquiry. Please visit our web pages or contact us directly on 0114 358 9009

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