Content provided by nudge, the financial wellbeing platform that helps people take control of their money.
The only way to make sure that your estate (money, possessions and property) goes to specific people after your death is to create a will. This is a legal testament of how someone wants their estate distributed after their death.
A will tells everyone what should happen after your death, making the process less time-consuming and uncertain for your loved ones.
What else can you do with a will?
As well as allowing you to allocate your money, possessions, and property to loved ones after your death, you can also do the following.
- Appoint guardians for any children under 18 and make financial arrangements for them as they grow up.
- Set up trusts. Please consider the Inheritance Tax implications by speaking to a tax adviser or HMRC directly.
- Name the executors of your will (people who'll make sure your instructions are carried out when you die).
- Make your own funeral arrangements.
If you don't have a will, your estate will be divided according to intestacy rules. This means that if you're unmarried and don't have a will, your partner may not be legally entitled to your estate.
A will is the only way to make sure that your estate is taken care of. This is not just in financial terms but also in the care and living arrangements of your children and/or partner.
You can write a will in many ways, though your best option will be determined by how complex your wishes are.
- A specialist solicitor is advisable if your estate is quite intricate (for example, you want to set up trusts or have money overseas) as you'll need a higher service level. They usually cost between £150-£300.
- A will writer (note, they're not solicitors) normally charges between £75-£150.
- You can buy a template document or use online companies if your needs are simple and basic. To make the will valid, you'll need to say how your estate should be shared and sign and date it in front of two witnesses, who'll also need to sign it.
You may wish to amend your will or create a new will when circumstances change. For example, if you have a child or someone named in your will passes away. Getting married will invalidate an existing will, so you may want to revisit that. If you only want to make minor changes, you can add what's called a 'codicil' to your existing will, rather than writing an entirely new will. A codicil must be witnessed and signed the same way as a will, though there's no limit on how many of these changes you can make.
What happens if you don't have a will
If you don't have a will, the law decides how your estate (money, property and possessions) is divided. When you die without a will, this is called intestacy or dying intestate. Intestacy law then decides who'll inherit your estate.
There are slight variations across the UK, but if you don't have a will, your estate will generally be divided. See below for examples.
- Spouse/civil partner with no children: Your spouse or civil partner inherits everything (old rules split the estate with siblings and parents if it was over £450,000).
- Spouse/civil partner and children: Your spouse or civil partner inherits the first £270,000, then half of the remainder of your estate. The remaining assets are held in trust for your children until they're 18.
- No spouse/civil partner but children: Everything goes to your children in equal shares.
- No spouse/civil partner or children but parents: Everything goes to your parents in equal shares.
- No spouse/civil partner, children or parents but other living relatives: Everything goes to other relatives in the following order. First, siblings (or their children if they are passed on), then grandparents, uncles and aunts (or their children if they are passed on). Whole blood relatives receive preference over half-blood relatives.
- No spouse/civil partner, children, parents or living relatives: Everything goes to the State.
You should also be aware of the three rules listed below and whether they're in opposition to your wishes.
- If you have a partner (who is not a spouse/civil partner) or step-children, they won't be able to inherit unless stated in a will.
- If you don't have immediate family, you may have friends that you'd prefer to leave money to over relatives you don't know. Again, this won't happen unless you have a will.
- Spouses or civil partners you're separated from but not divorced would still inherit some or all of your estate under these rules if there's no will.
The only way to make sure that your money and possessions go to the people you want after your death is to create a will.