Half of people over 40 have not taken steps to plan for later life or have made a will – and thus run the risk of their homes and savings not ending up with those they want to leave them to.
Only one in two has started getting their act together by drafting a will, arranging a durable power of attorney or planning an inheritance tax, according to a survey commissioned by Solicitors For The Elderly and conducted by Censuswide.
The importance of a valid will was exposed for 51-year-old Yasmin Abdalla (not her real name) last year when it cost her her home.
Only one in two people over the age of 40 has started managing their affairs by drafting a will, arranging a durable power of attorney or planning inheritance tax
At age 54, her partner, Imran (not his real name), was fit and active before he contracted Covid-19 and had never written a formal will, even though he worked in the legal profession.
His death in January 2021 sparked a legal struggle with Imran’s former partner – and Yasmin did not receive a penny from his £600,000 estate, including the £500,000 property she shared with him, as Imran’s former partner’s name is still on the card. deeds stood.
Yasmin and Imran had been together for nine years and had a Shariah marriage in 2014 – a union recognized by the Islamic faith. However, it had no legal status, as the couple did not register it with their local government.
Yasmin, who lives in Cambridgeshire, says: ‘The whole experience was terrible. Imran would have been so angry if he could have seen what happened as a result of his death without a will.’
But Imran wasn’t alone: Nearly one in three over-55s have yet to write a will, while only one-fifth of over-35s have one, according to insurer Royal London.
Managing an “intestate estate” – the term used for those who die without a will – can be time consuming, costly and painful for left-behind relatives.
James Antoniou, head of estate planning at Co-op Legal Services, says: “The importance of a valid will cannot be overstated.
Many people mistakenly believe that their loved ones will automatically inherit their assets when they die – but if someone dies without an intestate, they lose control over what happens to their estate.
This can mean that their last wishes about who will receive their savings, possessions, properties and investments do not go into effect, leaving disappointed loved ones behind.’
When drafting a will, it is important to think about your next of kin. You need to consider how your estate is divided and who would take care of children under the age of 18.
You should also think about protecting your partner. With fewer people getting married, the number of cohabiting families is increasing, according to the Office for National Statistics.
But the law hasn’t caught up, meaning unmarried couples are largely unprotected if one of them dies.
Unlike married couples or people in civil partnership, there is no legal right to property that is not jointly owned, although cohabiting couples in Scotland may be able to claim cash or assets from interstate estates.
Plan: When drawing up a will, it is important to think about your next of kin. You need to think about how your estate is divided and who looks after children under 18
Clare Moffatt, pension and legal expert at Royal London, says: ‘You could have a situation where a childless couple has been living together for ten years, but the house was bought before the relationship started and is in the name of only one of them.
“If that person dies, the death penalty would mean that the house is sold and the proceeds go to the parents of the deceased.”
For couples who jointly own a home, the other partner may keep the home if one of the partners dies. However, communal tenants may discover that they eventually own their home with their deceased partner’s mother or father.
By getting your affairs in order, you can also avoid large estate taxes on the assets you leave behind. Anything left to a spouse or civil partner is exempt from inheritance tax, and bequeathing property to children or grandchildren can also lead to lower inheritance taxes.
To draft a will, you need to take some basic steps, such as valuing your estate, which includes real estate, savings, investments and other assets, minus any debts.
You have to decide whether to donate to charity, and you also have to choose your executors – the people who will be in charge of distributing your estate after you die.
When writing your will, it is often best to seek advice from a lawyer who specializes in wills and probate, especially if you have complicated financial matters.
You can also use a professional will writer or create your own will.
Anyone can make a will, so make sure yours is regulated. Unregulated parties can put your savings at risk.
If you choose to do your own will, make sure it is valid. When you sign the will, it must be in the presence of independent witnesses.
Intestate estates aren’t the only headache: Cases involving outdated or non-specific wills can turn out to be just as messy, says Holly Chantler of law firm Morr & Co Solicitors.
In a recent case, a mother had her three young children in court days after her husband died and she was circumvented in the transfer of his assets, Ms Chantler said.
“The woman didn’t own the whole property and much of her husband’s house and savings went to their young children. It was a real mess – and it could have been prevented.’
Such complications can arise when couples are registered as joint tenants, each owning a certain portion of a property. Renting together can solve this problem.
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