Richard T Lishman is the principal of money4dentists, a specialist firm of Independent Financial Advisers who help dentists across the UK manage their money and achieve their financial and lifestyle goals.
This month the money saving tip potentially save you £thousands, and more specifically a lot of hassle.
The reason this money saving idea sprang to mind is that I recently met a couple of clients who don't have Wills, and they actually thought that as they were married everything would go their spouse in the even of one of them dying. Unfortunately if you have not written a valid Will, your property will pass according to the Law of Intestacy with the following results:
- Leaving money to people you perhaps didn't want to
- It's likely to take longer to finalise than if you had written a Will
- During this time your beneficiaries may not be able to draw any money from your estate
- It can also mean arguments and distress for relatives.
So what happens under the law of intestacy? If you are married don't assume all your assets will pass to your spouse in the event of your death. Children, brothers, sisters or parents may also have a claim. Let's explore a few scenarios.
If you have children and your estate is worth more than £125,000, your spouse will only receive the first £125,000 and a life interest (i.e. the right to take interest on the remainder, but not the capital itself) in half the remainder – your children get the rest.
If you have no children but still have surviving parents your spouse will get the first £220,000 plus half the balance – the rest is shared between parents.
If you have no parents but brothers and sisters your spouse will receive the first £200,000 plus half the balance - the rest is shared between brothers and sisters.
If your estate is worth more than £200,000, the only time your spouse will get everything is if you have no surviving parents, children, brothers or sisters!
If you're not married the order of beneficiaries is children, parents, brothers or sisters, grandparents, uncles and aunts, and finally to the crown.
So remember, making a Will is the only way to ensure that your wishes are carried out after your death, as if you're not here, you can't have your say!
The above figures are for illustrative purposes only and may vary considerably from reality and should not be relied upon as an accurate reflection of future returns. As with all investments, the value can go up or down and there is no guarantee to future returns.