Writing a will and keeping it up to date is the best way to make your wishes known. While dying without a will – known as dying “intestate” – can lead to huge complications for those you leave behind.
For confirmation of this, we need only look behind the sofa of the late soul legend Aretha Franklin.
Your will should be a formal document, not a handwritten note stuffed behind your sofa
Back in 2019, Franklin’s niece found a handwritten “will” underneath a cushion on her late aunt’s sofa. The note, dated 2014, named a different executor to another handwritten note previously found in a locked cabinet at Franklin’s home.
So began a nearly five-year-long legal battle that pitted Franklin’s sons against each other.
While the 2010 note named Ted White II as the executor, the 2014 “sofa document” had Ted White II’s name crossed out and replaced by Kecalf Franklin.
Both notes confirmed that Franklin’s four sons would share music royalties, but only Kecalf (and his children) would inherit Franklin’s main residence, originally valued at around $1.1 million (£850,000).
A 2010 clause ordering both Edward and Kecalf to take business classes and get a degree was also removed from the 2014 note.
On winning the case, Kecalf said: “I’m very, very happy. I just wanted my mother’s wishes to be adhered to.”
Failing to put a legal will in place might not lead to such a high-profile case as this, but even in the UK, will disputes are on the rise.
Communication is key at every stage of the will-writing process
Back in November 2022, MoneyAge reported that 24% of adults haven’t discussed making a will with their partner or spouse.
And yet, communication is vital. Not only can it help you to think seriously about your wishes (often for the first time), but it can also help to avoid disputes.
You’ll need to:
- Look closely at the value of your estate and decide if there’s a potential Inheritance Tax (IHT) liability
- Decide where you want your wealth to go and how to split those assets, whether evenly or not
- Discuss your plans openly with those affected to help avoid potential disputes once you are gone.
3 reasons to write a will now
1. A will puts you in control while reducing stress for your loved ones
The unexpected can strike at any time and it’s never too early to put a will in place. Making your wishes known puts you firmly in control of your hard-earned wealth. Communicating these wishes ensures that they are known and that the reasons behind them are understood.
You might find a will particularly important if you don’t intend to split assets evenly among children, or you live with a non-married partner or have step-children.
Dying without a valid will in place means ceding control to the laws of intestacy, which usually favour blood relatives. You might find that nieces and nephews inherit in place of your partner or step-children.
Not only might this go against your wishes, but it also places huge amounts of undue stress on your family, at an already difficult time.
2. Writing a will forces you to look at your assets and could ensure you distribute your wealth tax-efficiently
The value of your wealth that exceeds a certain threshold, known as the “nil-rate band”, is usually liable for tax at 40%. IHT can make a huge difference to the amount you can pass to loved ones.
This is especially true currently, as both the nil-rate and the residence nil-rate band are now frozen until at least 2028.
As the value of your wealth and property rises over the next five years, the likelihood of your estate topping the IHT threshold increases.
Speaking to an expert financial planner can help you to understand the best ways to lower a potential liability and leave as much as possible to your family.
Tax-efficiently managing your estate might involve gifting some of your money during your lifetime. Gifts lower the value of your estate for IHT calculation purposes while ensuring your money goes where you want it to go.
Speak to us now if you think your estate might become liable for IHT and we can begin to put tax-efficient strategies in place.
3. A will provides you with peace of mind but you need to ensure it remains up to date
A will is the simplest way to make your wishes known and provide you with peace of mind. But this is only the case if your will is up to date.
Life events like births, deaths, and marriages can alter your priorities and might mean that your will needs amending.
Check in with it regularly (at least once a year) to ensure it still aligns with your wishes and is fit for purpose.
Also be sure that your loved ones know where to find the document in the event of your death. A locked cabinet or with a solicitor is a good idea. The back of the sofa is not.
Get in touch
Contact us now to find out how our Chartered financial planners could help you to manage your estate tax-efficiently.
Please note
The Financial Conduct Authority does not regulate estate planning, tax planning or will writing.
