By Emma McCann, Tax, Trusts and Estates partner at Irwin Mitchell
54% of UK adult population don’t have a Will and only 1% of UK adult population have a Lasting Power of Attorney (LPA). These are scary statistics given the vital protection that both a Will and LPA offer to every individual.
A lot of people don’t realise that if you don’t have a Will then the law decides who inherits your assets (known as the rules of intestacy). This may not be who you think it will be or indeed who you would want it to be. In fact in 2019 £53m went to the Treasury through intestacy, as people didn't have wills in place.
The only way to override these rules is to make a Will which clearly sets out your wishes for after your death. It gives you the peace of mind that you have formalised what you would like to happen and may help to prevent family disputes and upset following death.
A Will also allows you to make gifts of specific items of money; items of sentimental value or to benefit your favourite charity. None of this is possible without a Will. A Will also means you can protect property as well as children and other vulnerable beneficiaries via the use of trust arrangements and to appoint trusted individuals to important roles such as guardians, trustees or executors.
If you don’t have a Will or you made a Will a long time ago or your circumstances have changed (i.e., marriage, divorce, family death, new baby, accident or illness and inheritance, to name but a few) then you should consider making a new Will or reviewing your old Will.
When making a Will it is usually good advice to make a LPA at the same time. A Will makes arrangements for after your death whereas an LPA covers the eventuality of you losing capacity to manage your affairs during your lifetime.
Sadly 1 in 3 people over 65 will develop dementia and every 90 seconds someone is admitted to hospital in the UK with an acquired brain injury. Nobody knows what is going to happen and having an LPA in place is an important safeguard should this happen to you. Just because someone is your spouse or civil partner or because you consider them to be your “next of kin” then this doesn't mean that they can automatically deal with your affairs, should you be unable to do so.
The only way to ensure that you have someone in place who you trust to do this, is to make an LPA. There are two main types of LPA; property and finance and health and welfare. The advice would be to have both in place so that you have someone to deal with your finances as well as someone to make any important health decisions on your behalf.
If you make the arrangements to have a Will and LPAs prepared then you are well on your way to protecting not only yourself but also your closest family members from unnecessary stress, worry and cost should the worse happen.
Watch our webinar
I was recently on a panel with some of my Irwin Mitchell colleagues where we discussed Wills and LPA’s in relation to our recent research with YouGov. We asked more than 4000 adults aged 40 and over about their attitudes towards saving money and planning for retirement, and how these might have changed through the pandemic.
The survey uncovered a range of findings and key indicators of which groups are more likely to prepare for their future. It also showed which groups are more likely to slip through the gaps, including geographical, gender, age and social differences.
Watch the webinar recording where our legal and financial experts discuss the survey results and provide practical guidance on how you can plan for your retirement here.
You can also download our top tips PDF.
If you’d like to discuss your own later life planning or anything, please do get in touch.