Making a will is a really important part of your financial planning. It is something many people neglect to do figuring that it’s administrative hassle that they don’t need to bother with, often because they don’t consider themselves wealthy enough to merit one or because they believe that their spouse and children will automatically inherit their estate.
However, making assumptions about what will happen to your estate when you die is unwise and neither of these arguments holds water. A will is the only way to be absolutely sure that your assets will go where you want them to after you die.
Here are just some of the things that could occur if you fail to make a will:
1. A lengthy probate process
If you have no will, intestacy laws are applied in strict accordance with the law. Even if they would deliver the result that you want, this still lengthens the probate process. Your loved ones will inherit much quicker if you have a will clearly stating your wishes. This can help in covering funeral costs and inheritance tax due.
2. Your partner/stepchildren could lose their home
Unmarried partners do not automatically inherit, even if they have shared your home for a significant amount of time. The same goes for any children your partner has who are not your biological children or adopted by you, even if you have effectively brought them up. Without a will your home, or your share in it, is more likely to go to your children, parents or even siblings, potentially leaving your partner and stepchildren homeless. If you part-own a property with a partner and you are not married or in a civil partnership, if you want them to inherit your share upon your death it is imperative that you write a will stating your wishes.
3. Heirship disputes
Many a loving family has been torn apart by financial disputes after the death of a family member who dies intestate. Bob Marley’s family is a famous example with his widow and mother falling out big time over his estate. Prince also died without leaving a will which led to numerous people claiming heirship and a lengthy court battle for his sister and half siblings before they could claim their share of his estimated $200million fortune.
A will is the only way to leave no room for doubt over which family members you want to get what.
4. Your children could suffer
If you don’t have a will which sets out who you choose to be the legal guardian of your children if you die, it falls to a court to decide. They may or may not choose the same person as you but why leave it to chance? Even if the choice of legal guardian is obvious, having to go through the court procedure piles on additional stress at what will already be a very difficult time for your kids. It’s so easily avoided by getting your desired legal guardians down in writing.
5. An unnecessarily high inheritance tax bill
‘I’d like as much money as possible to go to the taxman when I die’ said no-one, ever. Minimising an inheritance tax liability is an almost universal desire and a will is one of the tools you will need to put in place as part of a bigger estate planning strategy. To find out what solutions are available to you to mitigate inheritance tax, you’ll need the help of an expert who is well versed in this specialist area. If you are an expat in Asia, the chances are that this person will also need to be experienced in cross-border estate planning to deal with assets in different parts of the world.
To sum up, there is only one way to ensure that your legacy goes where you intend it to, and that is by making a will.
If this article has provided food for thought and triggered a rethink on your no-will policy, we can help. Contact us and we will put you in touch with an estate planning expert in your area.