Let’s talk Wills
2022 has undoubtedly been a year of significant changes, whether that’s the ongoing effects of Covid, the cost-of-living issues, or the war in Ukraine. One or all of these events will no doubt have impacted people’s finances, relationships, or business interests in one way or another.
As a result, it is important to think about how such changes affecting such matters can affect a client and their family’s future.
Do you know how many clients have a Will?
Recent research from Legal & General have recently determined that 53% of UK adults do not currently have a Will. This means that they don’t have any control over who receives their assets when they pass away, or even know how much their estate is worth.
A Will is a legal document that allows a person to pass on their assets, family heirlooms, appoint guardians for their children, and include gifts to charities, friends and family. So, if a client has children, owns property, has savings or investments, or runs a business, making a Will is particularly important to ensure that beneficiaries will receive what is wished, as opposed to some unknown Court official giving assets to the wrong people.
The Wills sector is set to grow by 5.2% this year, from a current worth of £2.49 billion. There means will be plenty of scope to start discussing Wills with existing and new clients!
Life events that may trigger the need for a Will or to update a Will.
They have recently married or entered into a civil partnership
Even if married or in a civil partnership it is not guaranteed that their spouse will inherit all or any property or assets if there is no Will in place. It will be for the courts to decide, which could be costly and timely. If it is a second marriage then there may be more complexity with children, multiples properties and separate assets.
They have recently become parents
Do they know that without a valid Will in place if something were to happen to them it's not guaranteed who will become the carer for their child. This may have to go through the courts, and social services may have to become involved.
They have moved house
Have they moved to a bigger property? Have they considered what will happen to the property in the future, it’s a huge investment that could get taken away from the family if not properly allocated for in a Will.
They have gone through a divorce
If they have a Will then it may need to be updated to cater for the fact they are no longer with their spouse. If they don’t have a Will they may wish to secure their children inheriting their remaining assets.
They have had a change of assets over recent years
If they have a Will it may need to be updated to include all relevant assets, any new properties or change in beneficiaries. If they have no Will and have increased their assets or acquired properties, they may need to consider what will happen to them, there is no guarantee they will go to a family member unless it’s written into a Will. Also, maximising tax allowances is essential as assets increase over time and a correctly drafted Will could be the key to ensuring these allowances can be claimed by your estate.
They have retired
At this stage in their life people often feel the need to make arrangements for their estate, expressing clear intentions within their Will that they may be making for the first time or updating an old Will.
They are recently widowed
Perhaps unsurprisingly, those who are recently widowed are likely to wish to put a Will in place. Either because they have gone through a process where there was no Will and experienced how traumatic it can be, or their assets and property status has changed and they need to ensure all is catered for in the future with their family.
Ensure a Will reflects all wishes
If your circumstances have changed, you should talk to clients about updating an existing Will (if there is one). In any of the above circumstances, a Will should be updated to ensure it is reflective of the current situation.
Do any beneficiaries or executors need to be changed?
Many people need to change the people that are named in their will for a variety of reasons. Perhaps a person has outlived the executors or beneficiaries named in a Will, or maybe the relationship has deteriorated. In this case, it’s best to update the Will to avoid complications in the future.
Have business interests changed?
This last year in particular has been challenging for businesses. With adjustments to rising living costs, some businesses may have struggled. Partners and directors in the business may have changed, business structures may have changed, downsizing may have occurred. So, if business interests have changed significantly, now would be a good time to review both a will and a succession plan for the business.
Take advantage of Inheritance Tax planning?
It is always advisable to review a will and estate planning regularly in line with current tax legislation, reliefs, and opportunities to save on Inheritance Tax thresholds.
In today’s world it is no longer only the super-rich whose families face high tax bills on death. Property prices, although slowing, are high and tax reliefs are not always keeping pace with inflation, so now is a great time to start looking at ways to create a tax efficient Will and estate plan to ease any tax burden later.
Reviewing affairs can be a great way to start the year on the right foot for confidence in future planning. It allows clients to understand where they are financially, and to effective make plans for the future.
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