Making a Will

The Probe - December 2005

This week I’m not going to give you any tax saving ideas but this tip could potentially save a lot of money and more specifically a lot of hassle. The reason I wanted to highlight this issue is that I’ve met a couple of clients this week who don’t have Wills and thought that as they were married everything would go their spouse.

Unfortunately if you have not made a valid Will, your property will pass according to the Law of Intestacy with the following results:

• Leaving money to people you didn’t want to
• It’s likely to take longer to finalise than if you had made a Will.
• During this time your beneficiaries may not be able to draw any money from your estate.
• It can also mean arguments and distress for relatives.

So what happens under the law of intestacy?

If you’re married don’t assume all your assets will go to your spouse. Children, brothers, sisters or parents may also have a claim.

If you have children and your estate is worth more than £125,000, your spouse will only get the first £125,000 and a life interest (ie the right to take interest on the remainder, but not the capital itself) in half the remainder – the children get the rest.

If you have no children but still have surviving parents the spouse will get the first £220,000 plus half the balance – the rest is shared between the parents.

If you have no parents but brothers and sisters your spouse gets the first £200,000 plus half the balance - the rest is shared between brothers and sisters.

If your estate is worth more than £200,000, the only time your spouse will get everything is if you have no surviving parents, children, brothers or sisters!

If you’re not married the order of beneficiaries is children, parents, brothers or sisters, grandparents, uncles and aunts, and finally to the crown.

So remember, making a will is the only way to ensure that your wishes are carried out after your death.