Have You Made a Will Yet?

27 March 2020

Have you made a will yet?

So many people have not got around to making a will. If you don’t yet have a will, you’re not alone. Over half of adults in the UK haven’t made a will. Research from Royal London Insurers suggests that 54% of UK adults don’t have a will’

The research further confirms that nearly 60% of parents don’t have a valid will – meaning they either don’t have one at all, or the one they do have no longer reflects their circumstances. E.g. maybe people have since had children, divorced, or perhaps beneficiaries have passed away?

Some of us believe that there is no need to make a will, and that your loved ones will inherit your estate anyway. If you die without a will, you die ‘intestate’. The intestate rules are very tight however, and your loved ones might not see the results they expected or desired. 

It is possible that your loved ones miss out entirely e.g. your cohabitee's own children.  Sometimes a large and unwelcome inheritance tax bill might suddenly appear which might have been avoided by making a will

What are the rules of intestacy?

Intestacy is the legal term for someone that has died and does not have a Will (or the one they have is invalid).
It provides a set of rules providing a strict order of priority of who gets what when you die without a will:

If you are married with no own or adopted children

Everything goes to your spouse or civil partner.

If you are married with your own or adopted children

Your spouse/civil partner receives everything up to the value of £270,000 and half of any remainder. The other half of the remainder is shared equally between the children.

If you are not married and have your own or adopted children

Everything is shared equally among your children. Nothing to cohabiting partners or their children.

If you are not married and have no own or adopted children

Everything will be shared equally among one of the following groups of people (if they exist) in this order of priority:

  1. Parents
  2. Siblings (or their children, if they pre-decease you)
  3. Grandparents
  4. Uncles and aunts

There are also rules for half-blood siblings/aunts/uncles etc. Note – nothing goes to cohabiting partners or their children.
Everything goes to the Crown if you have no dependants or they can't be traced.

What if I am living with someone but not married or in a civil partnership?

This is the biggest fear/risk of the intestacy rules. In such a case, your partner would receive nothing at all, regardless as to how long you might have lived together. The same goes for any children your partner may have (who are not your biological children or adopted by you) even if they were financially dependent on you; they would receive nothing. You might not have expected this! Would you rather your remote relatives inherit over your cohabiting partner? 

What are the other risks of dying intestate?

Even if the intestacy rules satisfy your requirements in so far as who gets what, people should understand that the process is slower and legal fees need to be incurred. Your loved ones will wait longer for their inheritances. You could also help them with funeral costs and tax planning by making a will. Only a spouse is tax exempt. Other beneficiaries may well receive inheritance tax bills. And, remember that what might be ok this year, may not be ok next year!

Circumstances can and do change

You might have no dependents or close family, and you see little point in a will. This simply means your assets will go to your distant relations (who you might not know well or not be close to). Ultimately, if no relations can be found there is a possibility that the Crown will inherit all your assets. So even if you have no close relatives, a will lets you choose to leave the money to close friends, charities or other good causes you want to support.
In any event, you may meet someone and form a relationship with or without children and the process of intestacy may very quickly not be your ideal model.

Can beneficiaries get around this? 

Wills can be challenged but regrettably the intestacy rules cannot. However, if a loved one receives nothing under intestacy and that person believes that the deceased would really have wanted the loved one to have something, a claim under the Inheritance (Provision for Family and Dependants) Act can be made. There are tight procedures here though.

Loved ones such as an unmarried partner, or an unadopted stepchild, or someone otherwise dependent on the deceased financially could potentially do this. There are time limits however and of course – legal costs.  

The only other way for a neglected loved one to get remedy is to contact those who have inherited and persuade them to give up something. This however comes with no guarantees and could be embarrassing and of course expensive.

John Davies
19th March 2020

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You might also enjoy reading our previous blog on How to Leave Cryptocurrency in your Will?