Why do I Need a Will? The vast majority of people put off making a will for a variety of reasons; either believing that the people they would wish to inherit will automatically do so, or because they don’t think it is relevant to them at this particular stage of their life. Some people may be in a complicated relationship and do not want to confront the will issue. The reality is that you can put off making a will until it is too late and this poses all sorts of problems for the people left behind. It could mean that some or all of your inheritance either goes to the wrong person or to the state. Affording you peace of Mind Firstly and most importantly is the peace of mind a will provides. Making a will enables you to plan exactly what will happen to your estate following your demise. This ensures that those you would like to benefit actually do so, in accordance with your wishes and at the same time avoiding any possible disputes between relatives. Who needs to make a Will? The answer is Everyone . Especially: anyone with dependent relatives, (children under the age of 18, elderly relatives or relatives with a disability who have special needs), anyone who owns property or has any type of asset or business which you would wish relatives, friends or charities to benefit from. But won’t everything go to my husband/wife/civil partner/parents/children/etc automatically? This is a common misconception and dependent on the size of your estate, there are set rules which will be applied to determine who inherits and how much if you do not make a will. So what happens if I don’t make a Will? You will die Intestate . There are specific rules of intestacy which set out who will inherit and by how much if you not leave a valid will. This may not be what you would have wished and in the worst case scenarios where relatives cannot be traced, your assets will be taken by the state. You also need to bear in mind that should there be no will in place: – Partners/unmarried couples, step-children, nieces and nephews are not included – Potential tax issues can arise which may have been avoided – People you do not wish to benefit may inherit and your administrators may be people you do not want to have control over your estate. – Children inherit at 18 – unless you specify a different age in your will. Who can make a Will? Anyone over the age of 18 who is of sound mind. Is making a Will difficult? No. You need to make a list of your property and assets and consider who you wish to benefit from your estate; ensuring provision has been made for dependent relatives. You should also consider who you would want to look after your children (Guardians) if they are still young. What makes a Will Valid? It should be in writing, appoint someone to carry out the instructions of the will (an Executor) to dispose of possessions/property. Executors can be family members (including beneficiaries), friends or solicitors. It must be signed by the person making the will (the Testator). This must be done in the presence of two witnesses who must sign the will in the presence of the Testator. Who can be a witness? Anyone who: – Is not blind – Is capable of understanding the nature and effect of what they are doing – Is aged 18 or over A witness should NOT be: – A Beneficiary in the Will – Married to, or be the Civil partner of a beneficiary. In these circumstances, the will remains valid and a legal document, but the gift to the beneficiary cannot be paid. Can I state what happens to my body in my Will? Lots of people shy away from discussing their funeral arrangements with family or friends, so making a will is a good way of letting people know whether you wish to be buried or cremated and any specific requests you might have for your funeral service. Other Considerations What happens if your beneficiaries die before you? Their share can be divided between the surviving beneficiaries or redirected to someone else for example their spouse or children What happens if you marry or divorce after making a will? What do you leave your beneficiaries? A particular item, a set sum or a percentage of your estate? Are sums of money to increase with inflation? The terms of any trusts you may need or want to set up You cannot be forced or pressurised into making your will Care costs – if the surviving spouse needs nursing care then the whole estate, including the family home, would be susceptible to the cost of that care Lasting Power of Attorney – If you were unable to look after yourself, have you given somebody permission to make decisions for you with regards to your health, welfare and finances? Creditors or Bankruptcy – If the surviving spouse was subject to creditor claims/bankruptcy then the inherited estate is fully at risk Inheritance Tax (IHT) – would have to be paid on any amount inherited in excess of the Nil Rate Band and so there is the potential to pay IHT on the same asset twice. Business Assets – Without the correct planning, the business may have to be sold and these assets may not be preserved for your family. You can decide how you would like your share of a dental practice to be dealt with on your death, in the event that you are in a partnership. Updating Wills Circumstances change. Assets may be bought or sold (like dental practices, buy to let properties for example) and their values may change. You may find that you are now caught in the inheritance tax bracket and need some tax advice. Your beneficiaries’ details may change or you may decide to change who gets what under your will. As a dentist, it is important to have the correct estate planning in place. You have worked hard to build up your assets for your family and the last thing you would wish for is for the bulk of your estate to go towards inheritance tax or people benefiting from your estate that you didn’t want to wish to benefit. About Dino: Dino Charalambous works for Frank Taylor and Associates as a Financial Planner and provides a personalised service for his clients in mortgages, life insurance, critical illness cover, income protection, general insurance, pensions and investments. Where possible, he likes to provide face to face interviews so as to get a full understanding of his client’s requirements. The Dental sector is his main focus as he has worked with many dentists over the past 7 years and has an insight into the sector as most of his friends are dentists! Dino’s contact details are 08456 123 424 or 07939 457589 or email: [email protected]
