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Making a will (and the risks if you don't)

Have you got a will? Or are you happy for your assets to be eaten up by the tax man and the Government? Law Society research reveals that at least one third of UK adults do not have a will. Many people assume that in the absence of a will, their partner will get everything. Some think it is only something you need to arrange if you are very wealthy or when you are old. But this is not the case.

What happens if I die without a will?

Dying without a will is called dying intestate. In England and Wales the rather antiquated intestacy rules do not recognise unmarried partners or step children. Dying intestate can add a legal and administrative headache to financial and guardianship heartache. It can take many months before those left behind are able to gain access to bank accounts, savings and even life insurance. Here are the financial effects:

Married with children: Your spouse gets everything up to £125,000 plus your personal possessions. (If your property is worth more than £125,000, your spouse could lose their home). Anything remaining is divided in two: - half goes to your children when they are 18 years old (You may feel that 18 is too young for children to inherit - you can stipulate an alternative in your will); -half goes in trust during your spouse's lifetime (he or she does not have access to the capital - only income from the capital). On your spouse's death, this half goes to your children.

Married, no children: If you have parents, brothers or sisters, nephews or nieces, your spouse gets everything up to £200,000 plus your personal possessions. Anything remaining is divided:-half goes to your spouse; -half goes to your parents;- if no parent is living, then half goes to your brothers or sisters or their children.

Unmarried couples: If you are unmarried, you cannot leave your property to your partner unless you make a will. If you have no close relatives, your estate goes to distant relatives, or to the state. This is one of the most common areas for misconceptions - most people wrongly assume that a live-in or 'common law' partner will automatically benefit from their estate.

Single parent (or both parents of dependent children die intestate): the state will decide who will have parental responsibility for the child/ren, including the possibility of making them a ward of court. This can be avoided by making a will which nominates guardians of your choice in the event of your death.

How to make a will

Making a will is, for most people, a simple process, through a solicitor or professional Will Writer. Although DIY will kits are available, the Law Society recommends choosing a solicitor who is approachable as well as affordable to make your will rather than trying to do it yourself. If you do not have a solicitor already, you can ask for a personal recommendation from a friend or look in the Yellow Pages under "Solicitors". And the Law Society publishes a Regional Directory which can be found in local libraries and Citizens' Advice Bureaux. Once the will is completed you can either lodge it with your solicitor or keep in a safe place at home or even at your bank.

Common misconceptions about wills:
  • A letter conveying your desires as to what is to happen to your property on your death constitutes a legal document. It does not.
  • The surviving spouse always inherits their partner's estate, which they must use for the benefit of the family. This is not so.
  • Your next of kin automatically acquires your property and has a legal duty to distribute it fairly amongst the members of your family. This is not so.
Changing a will

Once you make a will it can be changed and superseded throughout your lifetime to take into account any changes in your circumstances or wishes. An expert can help ensure that this is done correctly and that previous wills are revoked. This is particularly important when you get married. Any existing will is automatically revoked upon marriage. Equally, if you divorce, your former spouse will be removed from your will because the law supposes that you would not want them to inherit your estate. Because of these assumptions, special care needs to be taken if you wish to make provision for a former partner or children after divorce. This must also be revisited if you then remarry.

If the thought of your former spouse getting their mitts on your estate would have you turning in your grave then the best way to avoid it happening is to make a will. Dying intestate will not give your ex an automatic benefit but the courts may decide that s/he is one of the people with a right to make a claim. The Law Society probate files include the following anecdote: A Kent man said in his will: 'To my first wife Sue, whom I always promised I would mention in my Will....Hello Sue!'.
The Law Society has six reasons to see a solicitor when you make your will:

1 Do you know the provisions of the Administrations of Estates Act, the Trustee Act and the Inheritance Tax Act - just three of the Acts of Parliament affecting the laws of wills and probate? Probably not, and why should you? But you should if you are going to make a will.

2 You can ask your solicitor to explain the extra powers available to your executors and trustees that you might want to include in your will.

3 If you're likely to have any liability for Inheritance Tax also known as death duties, are you sure that your will is tax efficient? A properly drawn up will can save Inheritance Tax, leaving more money for your family, friends and a favourite charities. A solicitor can advise you on tax planning.

4 Have you followed all the legal requirements that make your will valid? Unless it is signed and witnessed in a very specific way, it will be worthless.

5 If there are no arrangements for the final distribution of the remainder of your estate after all the gifts in your will have been made, the will is said to have "partially failed". The money left over will be distributed according to the legal "rules of intestacy" rather than your own wishes. A solicitor will always make provision for all your estate including the possessions that you don't yet know that you'll have!

6 The vast majority of disputes involving wills in the courts arise from home-made wills.

Further information:
This month, through the Will Aid campaign, you can get a professionally drawn up Will and instead of paying the solicitor, you can help some of the UK's best loved charities.

During November 2004 thousands of solicitors throughout the UK will waive their fee to draw up a basic Will. Instead they will ask you to make a donation (of around £65) to the Will Aid charities.

No excuses!

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