4 reasons to write or update your will today!

Writing and regularly updating your will ensures you have control over how your estate is handled and that your assets are distributed according to your wishes after you’re gone.

However, research from Canada Life shows that over half (51%) of UK adults do not have a will, leaving their estate vulnerable to the laws of intestacy.

Dying without a will – known as dying “intestate” – means you have no control over what happens to your possessions when you pass. Instead, government criteria determine who inherits, often prioritising certain family members over others, which may not align with your wishes.

By writing and regularly updating your will, you can ensure your intentions are honoured, your loved ones are cared for, and your estate is managed tax-efficiently.

Read on to discover four reasons to write or update your will today.

1. Your assets will be distributed according to your wishes

Perhaps the simplest and most important reason to write a will is to ensure your assets are inherited and distributed according to your wishes after your death. 

For instance, you may want to support loved ones with specific needs or leave meaningful items to those with a special attachment to them. 

A will also allows you to exclude certain individuals from inheriting your estate. For example, you may want to ensure that an ex-partner or an estranged relative who would be included under the laws of intestacy doesn’t receive any inheritance. 

In your will, you must also choose an executor to handle your estate. The executor is responsible for tasks such as closing accounts, managing debts, and distributing assets.

This is a significant responsibility, so it’s important to select someone you trust and who is capable of managing the process. If you don’t name an executor, the court will appoint one for you, which might not be who you would have chosen and could mean your wishes are not fully met. 

Even if you already have a will, it’s a good idea to review it regularly to ensure it reflects your current circumstances. Life events such as marriage, divorce, or the birth of children or grandchildren can significantly affect your estate planning needs.

2. You can designate guardianship for your loved ones

Your will also allows you to express vital wishes about the care of your loved ones after your death. 

If you have dependants under the age of 18, you can use your will to appoint legal guardians who will take responsibility for their upbringing. Failing to do so can have serious consequences, as a family court would then decide who becomes their guardian. This might result in someone being appointed who you wouldn’t have chosen yourself. 

In addition to naming guardians for your children, your will can also specify who should care for your pets after you’re gone.

So, by writing your will and including these details, you can ensure your loved ones are looked after according to your wishes. 

3. It can result in less stress and conflict for your family

When you pass away, your family is likely to experience significant stress and grief. In this emotional period, dividing an estate can become an area for disagreements and disputes among your beneficiaries.

A report in the Guardian estimates that as many as 10,000 people in England and Wales dispute wills each year. The report notes that in 2021/22, 195 disputes went to court, up from 145 in 2017. This rise has been fuelled by factors such as:

• The passing of the property-rich baby boomer generation, which has increased the financial stakes for descendants

• A rise in second marriages, leading to stepchildren being disinherited

• The growing prevalence of dementia, which raises concerns about the validity of some wills.

Without a will, your family may be left to guess your intentions, leading to misunderstandings and potentially costly disputes. These disagreements can drive wedges between family members and may lead to substantial legal fees, adding to the stress of an already difficult time.

Creating a clear, well-drafted will can help to reduce this uncertainty by making your wishes explicit. Including a personal letter – a “letter of wishes” – explaining the reasons behind your decisions can also provide valuable context, helping to prevent misunderstandings and offering comfort to grieving loved ones.

By ensuring your will is up to date and thoughtfully prepared, you can reduce the likelihood of disputes, preserve harmony among your family, and make the process of settling your estate as smooth as possible.

4. You could reduce your Inheritance Tax liability

With careful planning, writing a will could also reduce your estate’s Inheritance Tax (IHT) liability.

For example, if your will specifies that you’d like to leave your home to a direct descendant, such as a child, stepchild, or grandchild, you could benefit from the “residence nil-rate band.”

This provides an additional £175,000 of IHT relief, on top of the standard nil-rate band, which covers the first £325,000 of your estate. However, it’s important to note the residence nil-rate band tapers at a rate of £1 for every £2 that the net value of your estate exceeds £2 million.

So, when combined, the residence and standard nil-rate bands give you a potential total tax-free allowance of up to £500,000.

Indeed, if you leave everything to your spouse and vice versa, you will be able to combine your nil-rate bands and pass on a collective £1 million free from IHT.

And there are further ways a carefully written will could help to reduce IHT.

For instance, including a gift to charity in your will enables you to make a meaningful and lasting impact by donating cash, assets, or property to a good cause. Such gifts are typically exempt from your estate for IHT purposes, offering both a generous legacy and potential tax savings.

Not only does this good deed benefit the causes you care about, but it can also provide financial advantages for your beneficiaries.

If you leave more than 10% of your net estate to charity, the IHT rate on the remaining estate decreases from 40% to 36%.

So, by incorporating charitable giving into your estate plan, you can support the causes that matter most to you while also reducing the tax burden on your loved ones.

Get in touch

A financial planner can assist you in organising your estate plan, ensuring it’s both tax-efficient and tailored to your family’s unique needs. This can help to give you peace of mind, knowing that your loved ones' futures will be well-secured and your wishes fully respected after you die.

To speak to a financial planner, get in touch.

Email info@mlpwealth.co.uk 020 8296 1799.

Please note

This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.

This article is for information only. Please do not act based on anything you might read in this article. All contents are based on our understanding of HMRC legislation, which is subject to change.

The Financial Conduct Authority does not regulate estate planning, tax planning or will writing.