What is estate planning and why is it so important?

Estate planning is the process of working out how best to leave money and assets to family. It allows people to protect their wealth for future generations and in some cases minimise inheritance tax. It can also involve making plans in case a person loses capacity to make decisions in the future.

Getting good estate planning advice and preparing the right documents will make things easier for loved ones, if the person were to lose capacity or when they pass away.


What’s the difference between making a will and estate planning?

The two are closely linked together. Writing a will is an important part of estate planning. But estate planning is a broader process, where wishes are documented in more detail which can help provide family with more protection.


What are the main steps in estate planning?

As a minimum, every adult should firstly have a will and Lasting Powers of Attorney. A will is a legally binding document that outlines what should happen when a person dies. It sets out how someone may wish to distribute property, money and personal possessions to family, friends or charities. It also makes provisions for children or pets and documents any funeral wishes.

The third step is to consider setting up trusts. These can either be set up in your lifetime or written into your will. The type of trust you create will very much depend on the type and value of your assets and the main purpose of the trust.


When clients should start thinking about estate planning?

Generally, the earlier your clients think about these things, the better. No one can predict the future, so the best thing to do is to make the right preparations so that if anything does happen, there are no question marks.

Who is eligible for estate planning?

As a minimum, anyone over 18 should at least have a will. In terms of setting up trusts, this will very much depend on any assets, what they are worth and how concerned clients are about protecting them or minimising inheritance tax.


People with more complex family situations, those who have quite a large estate value, or anyone who’s a key player in a business are more likely to need estate planning over and above simple wills and LPAs.


Many people have concerns about protecting their assets from things like remarriage, bankruptcy, long term care fees and any other third party claims. Estate planning can help in these circumstances.


It’s also important to seek advice as part of the wider estate planning process around life insurance, protection policies and pension funds, just making sure everything’s airtight. That way clients are preserving their wealth for their family and loved ones. The conversation for eatate planning can open the door to a host of needs from the client.


Multiple opportunities for advisers

So within estate planning there are a multitude of products you can discuss with clients, from wills, to a variety of trusts, inheritance tax planning, and LPAs. Not everything needs to be tackled all in one go, but ALL of your clients will benefit from having at least a will in place, and if they have one already do they need to review it?


All the support you need

At BTWC we help you ensure you are fully equipped to speak with your clients about Estate Planning. From identifying what your client needs, to discussing options and preparing documentation, we can help you every step of the way. The client is yours at every stage, and you get the repeat business and referrals from meeting your client’s needs!

Call us on 01522 500823 or email enquiries@btwc.co.uk