Everyone should have a will
Everyone should have a will, yet the fact is that only 1 out of 3 of us actually gets ’round to it. And a fair number of those are picking up a pack from a local stationery shop and doing it themselves. Perhaps okay if you have fairly simple arrangements, but for those of us who have children from previous marriages, or are unmarried with children, or have children with unstable marriages, then the best way is the professional way.
Choosing an Executor
There’s a lot to decide when you’re considering the practical matters of your own mortality. Who are you going to choose as your executors? Most of us will choose those that are closest to us – spouse or other members of our family. You can, of course, choose a solicitor who would know exactly what to do without emotion getting in the way but would also impose hefty fees.
Duties of an Executor
The role of an executor is not easy; their duties include:
- Determining all the assets and liabilities of the estate
- Collecting in the assets of the estate and paying any debts of the deceased
- Settling any tax liabilities
- Completing the necessary accounts
- Obtaining probate
- Distributing the estate in accordance with the will, once grant of probate has been issued
Some members of a family may start some of these duties but soon realise the onerous nature of them and pass everything to a solicitor. This can happen in particular where members of the family start to dispute the value of different items. If someone has young children, then guardians should be appointed. In most cases, there will be a surviving parent, but sometimes there won’t be, so appointing guardians becomes crucial, maybe even a couple of choices just in case those that are your first choice have circumstances that mean it’s not possible at the time.Do you have a will? Here are some compelling reasons why you should! Click To Tweet
If we don’t leave a will, then we are said to have died ‘intestate’, the laws of intestacy will kick in and administrators will have to be appointed. There are different rules for those who are married with children and for those who are married without.
Unmarried couples still have no rights over each other’s estates, and although jointly held assets such as a home will pass automatically to the other, any singularly held assets will not.
A will can be overridden
If we leave a will, then generally speaking, we can decide who we leave what to. However if reasonable provision has not been left for certain dependants, then the court can override under the Inheritance (Provision for Family and Dependants) Act 1975.
Getting it done right
One of the most compelling reasons for employing a professional to sort out your will is the stories you hear about wills failing through really silly mistakes – it not being witnessed for example, or worse not signed. A professional would not allow errors such as these and would ensure that if you’re the 1 out of 3 that has decided to do the right thing, then at least what you’ve done is valid.
Wills are often tested in AF1 the Personal Tax and Trust Advanced Financial Planning Paper but will also appear in other exams too.
Requirements of a Will
It’s worth understanding the requirements of a valid will:
- The person writing it must be of sound mind.
- He or she must be over 18.
- The will must be in writing.
- It must be signed.
- The signature must have two witnesses, who are also required to sign.
- The witnesses must not be executors or beneficiaries.
What is also often tested is the impact marriage and divorce can have on a will already in place.
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If you’re studying for your CII AF1 exam, and you’re wanting a feeling of confidence on exam day, grab our free taster to try out one of Brand Financial Training’s calculation workbooks for yourself. Click the link to download the AF1 Calculation Workbook taster now!