Tag: children

June 3, 2020

Top reasons why people don’t make a will

I recently asked for feedback about why many people in the 25 to 40 age group don’t make Wills. I received some very helpful replies. This is the first in a series of blogs demonstrating why a Will is not a luxury but a necessity. In each blog, I am going to demonstrate what can happen when someone doesn’t make a Will for one of the reasons given in the feedback. The stories will scare you and I don’t apologise for that.

Number One: “I have left instructions for my relatives. I know that they will do the right thing.”

One reason that people under the age of 40 don’t make Wills is because they trust their relatives to “do the right thing.” They write down their wishes and tell their families what they would like to happen. This is dangerous because a wish list does not have the force of law. If you live in England and Wales and don’t make a Will, your assets will pass under an inflexible system called the Intestacy Rules. If your family don’t respect your wishes, your partner may have to go to court to make an application for maintenance.

Let’s look at 4 different but equally frightening scenarios. I represented the wife in Situation A when I specialised in inheritance disputes. The names have been changed to preserve confidentiality. Situations B, C and D are variations on A that could easily happen.

Situation A

Alex and Beth had been married for 10 years. They had two children, Charlie aged 9 and Daisy aged 5. Alex was 38, had a well-paid job and had inherited a large sum of money from his grandparents. They owned their house in joint names but in 50/50 shares. This was to protect a deposit of £25,000, provided by Alex’s wealthy parents. Beth was 37 and worked part-time from home, fitting her work around the children. Beth fell out badly with Alex’s parents, shortly before Alex was killed in an accident.

Alex had not made a Will but had left careful hand-written instructions for Beth and his parents, about what should happen if he died. He had not left any instructions about his children’s education, welfare, or his parents’ access to the children. He had written down that he was relying on his parents not to recall the £25,000 ‘gift’ if anything happened to him. He expected them to behave honourably.

As Alex didn’t have a Will, his assets passed according to the Intestacy Rules regardless of his wishes. Beth was entitled to receive his personal belongings, the sum of £250,000 and half of everything else that he owned. The other half was to pass in equal shares to Charlie and Daisy. A trust was needed to manage the funds until the children were 18. Alex’s parents saw no reason why Beth should not downsize and repay their £25,000.

They also saw no reason why they should not manage ‘Alex’s money’ until their grandchildren came of age and applied for a shared residence order, (formerly known as custody), so that their grandchildren would live with them some of the time.

Alex had not nominated Beth as his beneficiary with his pension provider or his life insurance company. His share of the house, savings, ISAs and current account balance were in his sole name. Beth had to make an application for maintenance under a law called the Inheritance (Provision for Family and Dependants) Act 1975 – ‘The Inheritance Act’.

Beth was grieving and vulnerable. Her level of maintenance was eventually assessed by a court, many months after Alex’s death. The process was expensive, time consuming and emotionally exhausting. As his wife, she was entitled to a higher standard of maintenance than other types of applicants, but she was not awarded the whole of Alex’s estate.

Situation B

The nightmare set out in Situation A happens more often than you realise. Now imagine a worse variation. Alex and Beth are unmarried. The rest of the facts above are the same. Contrary to popular belief, a “common law wife” does not automatically inherit. Again, Alex’s assets will pass under the Intestacy Rules. He is unmarried but has children, so his assets will pass to Charlie and Daisy in equal shares. Some sort of trust will need to be put in place until the children are adults.

Alex’s parents see no reason why Beth should not downsize and repay their £25,000 once the dust has settled. They also see no reason why they should not manage Alex’s money until their grandchildren come of age. They are even more antagonistic as Beth was not their daughter-in-law.

Again, Beth will have to make an application for maintenance under the Inheritance Act. However, the court’s starting point, to assess her award from the estate, would be based on her need for maintenance only.

Situation C

Next assume that Alex and Beth are unmarried with no children. The Rules of Intestacy apply even more stringently. Alex’s parents would inherit all his assets. Again, Beth would have to make a claim for maintenance. It would be awarded at a lower level than if they had been married. Terrifying but true – even if she had been living with Alex for 40 years.

Situation D

Finally, suppose that Alex and Beth are Alexandra and Beth. They have been partners for 10 years. They have no children. They do not have a civil partnership. They have plans to get married but these are always being shelved because of Alex’s parents’ attitude. They gave Alex a deposit of £25,000 for her house when she was 25, before she came out. To say that their relationship with Beth is strained would be an understatement. Again, Beth would have to make a claim under the Inheritance Act for maintenance.

An Inheritance Act claim is eye-wateringly expensive. It is a complex area of law, requiring specialist solicitors and barristers. If the claim cannot be settled out of court, it proceeds to a hearing in front of a Judge, scheduled many months after a loved one has died. The Claimant has to find and fund legal representation at a time when they are grieving, and their financial situation is uncertain.

In all the above situations, not just Beth, but Charlie and Daisy and Alex’s parents need separate legal representation – three sets of lawyers with three sets of fees. A judge will have sympathy for Beth but is bound by previous court decisions called precedents and the scope of the Inheritance Act itself.

Don’t be caught out

Paget Will Writing can draft a Will swiftly and accurately taking account of your individual circumstances. A good Will draftsman provides advice to maximise tax allowances, offset inheritance tax and reminds you to give instructions to pension and insurance companies. Even complex Wills for couples, incorporating more than one trust cost a fraction of a defended Inheritance Act claim.

A Will is as vital as life or car insurance. Don’t be caught out.  Give us a call or send us an email to discuss and arrange your Will.

September 27, 2018

Should your 18 – 25-year-old children have Wills?

Imagine this scenario: –   A husband and wife have been married for nearly 30 years.  Let’s call them Mike and Jane*. They are in their late 50s.  Their marriage seems to be rock solid. Mike works abroad a good deal.  He is frequently away for weeks at a time.

Jane, an accountant by training, has been a home maker since the birth of their children.  She currently has a modestly paid, part-time job.  The couple are financially secure. Their mortgage is re-paid, and they have good pensions and decent savings. Their house is worth about £800,000.

The couple have three children; John aged 25, Laura aged 23 and Peter aged 18.  John has left home for good.  He has a decent job but no permanent partner or family of his own. Laura is single.  She has finished University and wants to do a post graduate course. Peter has taken A levels and is planning a “gap year” before University.

Jane has been a home-maker.  Like many women of her age, she has taken on responsibility for her elderly, widowed father, Geoff, after the death of her mother.  Geoff dies leaving a considerable sum of money to Jane. As she does not need the money from her father, she divides it equally between John, Laura and Peter.

Out of the blue, Mike tells Jane that he has met someone whilst working in the Philippines.  He wants a divorce so that he can marry her.  He is not interested in trying to save the marriage. This “someone” is a good 25 years younger than Jane.

Jane goes through a debilitating and humiliating divorce.  She must downsize from her comfortable home and look for a better paid job. Her children have left home and her father has died. Her whole life is turned upside down.

However – Jane is no fool.  She has given her children substantial sums of money from her father’s legacy to her. She knows that if her children were to die intestate, (without making a will), the statutory intestacy rules would apply. 

None of Jane’s children are married or in a civil partnership and none of them have children of their own.  Under the Intestacy Rules, if one of them dies, their “estate”, (which means all their worldly goods), would be split 50/50 between their parents; Jane and Mike. Therefore, half of Geoff’s money would go to Mike – a situation totally unacceptable to Jane.

For this reason, Jane persuades her three children to make basic wills. The children are the clients and their instructions are followed.  However, the resulting wills ensure that there is no risk of an unintentional windfall, of grandfather’s money, to their father.

Considering whether your children should have wills? Get in touch with me to discuss your circumstances.

*(This scenario is fictitious.  Any resemblance to real events and people is coincidental).

February 13, 2018

Making a will won’t kill you!

“Making a will won’t kill you!”

This is what I said to my Granny, who had a real superstition about it.  She genuinely believed that if she made a will, she would tempt Providence and instantly pass away.

We had “the will” conversation at her 92nd birthday party. My mother had baked her one of those cakes in two separate tins shaped as a “9” and a “2”.  We iced it and presented it so that it read “29”, which made my grandmother very happy.

I was 29 myself at the time and had qualified as a solicitor. I’m ashamed to say that I didn’t make a will until I was in my mid-thirties and married with my first child.

70% of us don’t have a will but 90% of us worry about what will happen – time to do something about it

Making a will is something that most of us don’t think about. Or we put it off for a future date when we are going to have some free time or available cash. Shockingly, around 70% of the UK population don’t have a will and yet about 90% of people worry about passing their money, intact, to their children and grandchildren.

For most people, the three big worries are the taxman, the spectre of nursing home fees and the prospect of protecting family wealth for succeeding generations. Unfortunately, if you don’t make a will, you cannot expect that your money, property and belongings will pass, automatically, to the people that you really want to benefit.

The “standard” family

In 2015 the Office for National Statistics reported that 42% of marriages ended in divorce in England and Wales. In 2013, 19% of men and women who were divorcing, had also had a previous marriage which ended in divorce.  This percentage figure was 10% in 1980. It had almost doubled.

One consequence of marriage breakdown is that it produces complex family situations, often involving grown-up children of first marriages and second wives with younger children. Many court cases have arisen where one marriage partner expects the other to “do the right thing by my adult children.”

Don’t assume you will inherit from your partner

The intestacy rules apply a “one size fits all” solution to an estate where there is no will. Some couples do not marry or enter into a civil partnership, although they are in committed partnerships that have lasted for many years.  If one of them dies without making a will, their partner could face the appalling prospect of having to apply to a court for maintenance from the deceased partner’s estate.

The bereaved partner will not automatically receive anything. They rarely receive the whole estate. It is an expensive, nightmarish process at a time when they are grieving.   Imagine the additional trauma if they have minor children.

Looking after your loved ones

If you are in a committed relationship – you need to make a will.  Likewise if you have minor children, you need to make clear provision for them and choose the people best suited to look after them if the worst were to happen.  If you have a disabled child, it is possible to incorporate a trust into your will. This will ring fence money for that child.

Why you need to make a will

A carefully drawn will dramatically improves your chances of minimising tax, avoiding care home fees and keeping your money out of your children’s divorce settlements. It also provides security and peace of mind for the people you love.

Take the first step to sorting out your families future by contacting Catherine Paget today at Paget Will Writing.

November 7, 2017

What would happen to your children if you die?

Using your Will to safeguard your Minor Children after your death

Few people think about what would happen to their children if they, themselves, die young. It is morbid and can seem as if you are tempting fate.  Most of us feel indestructible between the ages of 20 and 45.

There is always something more urgent to spend your money on than having a Will prepared. Typically your salary arrives in your account and goes straight out again to pay for the mortgage and other unavoidable expenses.

However you can make sure that if the unthinkable happened, you would have some control over what happened to your children.  You can appoint a guardian, of your choice, in your will.

Here are some frequently asked questions about appointing a guardian for your children:-

 Why should I appoint a guardian in my will?

Appointing a guardian in your will gives you the opportunity to choose the people who would look after your children if you died whilst the children were still under the age of 18.  You can select people that you trust, who already have a relationship with your children and might be the best “fit” for the children. If your children are old enough, you can ask them whom they would choose to look after them until they are 18.

You can include wishes about how you would like your children to be brought up.  You may want them to continue with music lessons, to be brought up in a particular faith, or to continue their education at the same school if the guardian lives in the same area.

Importantly, it gives you a chance to ask a friend or a relative if they are prepared to act in this role or if they would prefer not to do so. 

How do you appoint a guardian in your will?

A guardian appointed by will is called a “testamentary guardian.”  A simple clause such as “If my wife JANE SMITH dies, then I appoint my sister DIANA SMITH to be the guardian of my children who are under the age of 18”, would suffice to appoint a guardian if both parents had died.

 What are the responsibilities of a guardian?

A guardian has all the responsibilities of a parent.  They must be over 18 and mentally capable.

 When does guardianship end?

Guardianship ends automatically when a child turns 18 or if the child or guardian dies while the child is aged under 18. A guardian may disclaim their appointment within a reasonable time of discovering that they have been appointed. They may also be removed by court order. 

What should I consider when appointing a guardian?

The following is a non-exhaustive list:-

  • What is this person’s relationship with my children?
  • Are they already close to them?
  • Do they have children of their own?
  • Are they likely to be emotionally supportive?
  • Does this person live nearby?
  • Could the children continue to go to their school and see other family members or friends?
  • Is this person financially stable?
  • Is this person physically capable of caring for my children? An elderly relative may not be appropriate for very young children.

It is possible to appoint guardians who live abroad but it may not be practical. The guardian would have no automatic right to live in the UK because of their appointment as guardian nor would the child automatically be able to leave the country to move to live with the guardian.

For further advice contact Catherine Paget at Paget Will Writing Ltd.