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What is a Will and what can a professionally-drafted Will do?
In our experience most people know a Will to be a document that sets out how a person’s estate is to be distributed on the death of the testator. The risks of not making a Will are not appreciated, and what a professionally-drafted Will can achieve is lesser known still.
Rules of Intestacy ("RoI)
Before we look at a Will in detail, we need to look at what happens if you die without putting a legally valid Will being in place. If you die without a Will the Government have made a Will for you. Simplistically the Government's Will is a set of rules known as the Rules of Intestacy. It is a 'one size fits all' set of rules that are ideal for only a very small percentage of the population, they often cause unwanted hardship for surviving family members, and can be changed at the whim of the government of the day.
You can find flowcharts on the Internet of how these Rules will be applied by simply searching for 'rules of intestacy flowchart'.
Why You Need to Make a Will
The reasons why you should make your Will depend upon your circumstances.
Married /civil partner?
Many people who are married or in a civil partnership believe that everything they own will go to their surviving spouse/civil partner. This is generally true but if the estate is sizeable and the deceased had children send a proportion of their estate will go to their children - often causing hardship for their surviving spouse/civil partner. But even if all of the estate goes to the surviving spouse/civil partner what would happen to the estate if both parties to the marriage/civil partnership died in [say] a car accident? A Will allows all parties to cover this scenario.
Cohabiting?
If you are cohabiting with a person and they die without leaving a valid Will then you will have no claim on their estate. The deceased's assets will go to their children or if there are no children tend to their parents and if they have both passed away then to their siblings - under the RoI
Single?
If you are single and have no children then under the RoI your estate will go to your surviving parents. This can cause them to have an inheritance tax liability or to increase an existing potential IHT liability, or their inheritance from you might be used to pay for their care costs. A better solution is [often] to make a Will and give your estate to your siblings or your nieces and nephews.
A Parent of minor children?
If you are a parent with minor children then making a Will that includes a Guardian clause can stop your minor children being placed into Local Authority care if you or from your child/children.
Cohabiting?
A more complex Will can save a cohabiting couple with a sizeable estate up to £130,000 in inheritance tax. A Will also allows other tax planning to be made.
Disabled beneficiary?
A more complex Will can stop a person with severe disabilities finding that there means tested benefits stopped because they have inherited from you. The Will (together with a side letter) will also provide guidance for the trustees on how the inheritance for the disabled person is to be made available to them.
Protect against disinheritance?
A more complex Will can protect your estate for your children - who might otherwise be disinherited. If you give your estate to your surviving spouse/civil partner/cohabiting partner absolutely they might find another partner after your death, remarry after your death, or simply re-write their own Will to disinherit your children.
Care Costs a concern?
In certain circumstances a more complex Will can protect your estate from being used to fund the care costs of your surviving spouse/civil partner/cohabiting partner and ensure that your estate goes to your surviving children/grandchildren.
Specific Gifts
A Will allows you to make specific gifts to specific family members, charities, churches, and organisations. In certain cases specific wording is required. If your estate is distributed under the Rules of Intestacy then this option is not available.
Drugs / Failing marriage / Bankrupcy
A more complex Will can delay payment of your estate to a beneficiary who is presently taking recreational drugs, is bankrupt, and/or living in a failing marriage. These beneficiaries will ultimately benefit from your estate when those particular circumstances have been rectified.
Business Owner
If you run a business a Will allows you to state who is to inherit your business, and list any conditions you want attached to the gift.
Exclusion
A Will together with an appropriately worded side letter can, in certain circumstances, enable you to specifically ensure that a person does not benefit from your estate.
Orphaned child
In the event of you orphaning your child/children would you want your minor child/children andto then inherit your estate at age 18? Most parents want their children to inherit at age 21 or greater. A Will allows you to include such a stipulation: the Rules of Intestacy don't
Overseas property
If you have property in another country you can decide whether to include or exclude that property from being distributed by your Will. If you don't have a legally valid Will that covers the following property then that foreign property will be distributed in accordance with the rules of that country in which it is located.
Executors you trust
A Will allows you to appoint people you trust to sort out and distribute your estate - they are called your executors. If you do not have a legally valid Will at the time of your death then the law sets out who is to act as your administrator.
Administration clause and additional powers
A professionally drafted Will will also include a number of relevant administration clauses and power clauses that make life easier for your executors, trustees, and in certain cases your beneficiaries.
If you have made a legally valid Will the administration of your estate by your executors is significantly easier to undertake than when done under the Rules of Intestacy by your administrators.
What can a Will do?
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