Ten types of people who need to make a will
15th July 2015
Often, it’s dealing with the death of a relative that prompts people to make a Will. Having experienced the initial confusion, lengthy stress and unnecessary cost for themselves, they’re keen not to put their own family through it. Most heartbreakingly of all, the outcome is not always what the family expect. They can be left wondering, “Is this what they would have wanted?”
But don’t make the mistake of thinking wills are just for older people, or something you do on your deathbed. Starting a family is another spur to make a will because, for the first time, you have someone who depends on you totally. As well as making financial provision for your family, a will is the standard way to appoint guardians for children under 18.
So what if I don’t make a will?
When someone dies without making a will there is a strict order for inheritance:
- Your spouse (wife/husband/civil partner) – although they don’t necessarily get everything, and unmarried partners get nothing – see below
- Your children
- Your parents
- Your brothers and sisters
- Any half brothers and sisters
- Your grandparents
- Your aunts and uncles
- The government
This list was enshrined in law in 1925, when it was unthinkable that anyone with cash to leave would have children out of wedlock. In today’s society it’s more than a little antiquated.
Would it work for you and your family? Check the list below before you say yes…
1. I’m not married to my partner
It doesn’t matter how long you’ve lived together, there is no automatic right to inherit from each other. A lot of people get confused by the term “common law partner” but it doesn’t mean anything in this situation. If you don’t make a will, your partner would have to apply to a court to get anything from your estate. This can take months, sometimes years and they may struggle to keep going in the meantime. Worst of all, the value of the estate can be swallowed up by the legal bills. Make a will.
2. I’m married and have children from a previous relationship
Your new spouse is first in line to inherit from you, and your children only get a look in if you leave more than £250,000. Your children from a previous relationship can miss out completely because when your spouse dies, only their own blood relatives can inherit from them. You both need to make wills in this situation.
3. I’m separated but not divorced
Until your divorce is finalised with the decree absolute, your estranged spouse is still first on the list to inherit. There are so many things to think about when you separate that making a will is rarely one of them, but some people get a lot of satisfaction from making sure their ex can’t get their hands on anything if they die. Call it testamentary therapy, if you like.
4. There are specific people I want to provide for
Do you want to include someone who isn’t a blood relative, such as friends or godchildren? Maybe your brothers and sisters are doing OK and you want your nieces and nephews to benefit instead. Or you want to give something to your parents AND your brothers and sisters (the order of inheritance only allows one category to inherit at a time). For any of these situations, or if you want to spite your useless relatives by leaving it all to the dogs’ home, you need to make a will.
5. There’s someone I want to leave out
It may be that you’ve helped one of your children more than the others, and want to redress the balance in your will. Or there could be a rift which has led to a complete loss of contact. Whatever your reasons, if you don’t want to include someone who’s on the order of inheritance, you need to make a will.
6. One of my children has a disability
If your disabled child inherits it may affect their entitlement to benefits and other support, now or in the future. Some may have difficulty managing money, or worse, be vulnerable to financial abuse. Of course you want to provide for them, so to ensure that they benefit from their share without it becoming a burden on them, you need to make a will.
7. I’m supporting an elderly relative (or someone else)
This includes any kind of support that they’d otherwise have to pay for, including living under your roof, payment of care home fees or other living costs. There is no guarantee that support would continue unless you make a will. The person concerned will have a claim on your estate but it’s difficult, expensive and time-consuming to take it to court, and they would have no support in the meantime. Any claim on your estate would impact on your other beneficiaries, even if unsuccessful. Make a will to avoid this.
8. I’m a business owner
Different types of business are dealt with in different ways. It’s not always possible for someone else to take over the reins, even temporarily. The worst-case scenario is that your business could fail, becoming worthless while your estate is being dealt with. Protect all your hard work by making a will.
9. I have assets valued over the inheritance tax threshold
Inheritance tax is definitely a contender for the most unpopular tax in the UK. Death duties are charged at a massive 40% on everything over the threshold (currently £325,000). The recent budget announced an increase in the tax-free amount, but behind the headline figure of £1 million, nothing will actually change until April 2017. The increase will be phased in from then on, but to get the full million-pound exemption you have to be married with a home worth at least £350,000. If you want to make the most of the assets you’re leaving behind, you need to make a will.
10. Everyone else
Even if you have the archetypical nuclear family – one marriage, 2.4 kids – and you’ve never fallen out with anyone, you still need to make a will. It’s the standard way to appoint guardians for your children, the only way to guarantee control of your assets and most importantly it takes a load of unnecessary stress off your family at an already difficult time.