Many people, especially the younger groups have preconceived ideas about the benefits or not of having a Will. About what will and will not happen when the unthinkable happens. The ideas generally are based around everything being OK, and these ideas are simply wrong!
If you die without a will then your Estate is subject to the rules of "Intestacy" and you are "Intestate". Essentially intestacy means you died without a Will and as such the Government will impose it's "one size fits all" Will and decide how your Estate is distributed, and to who. You and your loved ones have no say whatsoever in the matter, and the method of distribution is fixed and rigid.
As the most valuable asset most of us have is their home, the following are the general rules that affect this area.
If you are married or in a civil partnership at the time of death, then usually the half of the property from the deceased passes automatically to the spouse or partner. However if the partnership is seen as Common Law, then the partner inherits nothing.
Married or Civil Partnership partners who have previously separated informally, can still inherit - even if you don't wish that to happen, you have no say.
If there are surviving children, grandchildren or great grandchildren (bloodline) of the person who died and the estate is valued at more than £250,000, the partner will inherit:
As an example, if Serena was in a marriage with Max and they adopted a daughter called Alicia. Serena died without leaving a will (intestate). Her estate is worth £450,000. After Max inherits his share of £250,000, the estate that is left is worth £200,000. Max can have half of this, £100,000. The residue passes onto Alicia. Max can decide to do whatever he wants with his inheritance, with or without regard to Alicia.
In the same scenario if Serena and Max dies, they will give up the right to choose guardianship for Alicia. She will go into care
If the partners were on the property deeds together at the time of the death, when the first partner dies, the surviving partner will automatically inherit the other partner's share of the property. This is not what you want especially if the assets are worth a sizeable amount. They will be potentially paying inheritance tax where they could have avoided this..
Couples may also have joint bank or building society accounts. If one dies, the other partner will automatically inherit the whole of the money after it's unfrozen when Probate eventually is granted (in 6-24 months). Imagine trying to live on nothing for that time.
Property and money that the surviving partner inherits does not count as part of the estate of the person who has died when it is being valued for the intestacy rules. It is added to the total estate of the beneficiary, which maybe a problem when that person (the beneficiary) dies as everything may be subject to Inheritance Tax (IHT). So their children will get the FULL bill which can be avoided
Possibly the worst aspect of not having a Will, is that you have no control over where your estate goes. Any thoughts of how you would like it distributed simply won't apply. You will be in the worst possible position regarding tax liability, and if a property is involved, they may not inherit at all if the property is not protected properly, especially if the cost of care is considered. They will have no control whatsoever upon the outcome.
Also part of the process is to apply for Probate. With a Will, the process can take about 6 months to complete. Until that time, all monies in the estate are frozen, except the bank may allow a withdrawal to pay for funeral costs (they don't have to). Without a Will, Probate can take upto 24 months to complete. With monies frozen for this time, how would dependants and loved ones cope?
Organise the drafting of a Will and get straightforward Estate Planning for yourself at least, but preferably your partner as well if you have one. There are many benefits of being protected by a properly written Will and having Estate Planning, but from our point of view some of the main ones are,
Don't die intestate, get a Will. Your Family with love you for it!!
Time is running out - Plan before you're Late!