In order to avoid common pitfalls in estate planning, it is essential to take expert advice and our team at mlplaw are ideally placed to offer you tailored advice to ensure your estate planning is undertaken effectively and efficiently. Here, we detail the most common pitfalls made in estate planning.
- Pitfall One – Not Making a Will
A Will is the most important estate planning document that you should have in place, whether you are married, single, have children or not. A Will is the only document which deals with the whole of your estate (barring some assets such as pensions or life policies) and how it will be transferred following your death. The value of a Will should not be underestimated and the time and cost devoted to its preparation should reflect its importance and value. Ensure you review your Will regularly.
- Not Taking Proper Advice as to Inheritance Tax
When seeking advice regarding your Will, it is also important to consider the tax implications to give effect to your wishes in the best interests of your intended beneficiaries. Do not undervalue this exercise or cut corners. A well drafted will ensures your estate can take advantage of all available tax reliefs.
- Make Proper Provision for Blended Families
Second and third marriages are no longer uncommon, creating difficulties where there are children from the previous relationships which each party to the marriage wishes to ensure benefit from their share of the estate whilst also ensuring that the surviving spouse can continue to occupy the family home and receive the income they need. Where Wills do not fully appreciate and understand the complexity of these arrangements, the result can be that the children of one party to the marriage miss out on what would otherwise be their share of the estate, and this can lead to expensive claims and litigation over the administration and distribution of the estate later. Once again, careful estate planning and a well-prepared Will should help to avoid those consequences.
- Asset Protection
The desire to keep things simple must be weighed against the need to provide the protection that beneficiaries require. Where a potential beneficiary of your estate is young or disabled or not able to manage their money, there are ways in which the estate can be protected for their use and benefit by using the appropriate forms of trust. Trusts can also offer protection in the longer term against the possibility of a beneficiary divorcing at some point in the future and also lead to longer term IHT savings for the family.
- Family Disputes
If you are intending to exclude a close family member from a Will, or to leave your estate in unequal shares between your children, then it is essential to take professional legal advice as to the possibility of post-death claims and how to take steps to try prepare for such claims by the careful drafting of your Will and any ancillary statement of reasons.
To ensure you avoid the above pitfalls and that your estate is planned to provide for your chosen beneficiaries please contact firstname.lastname@example.org or call on 0161 926 1538 to speak with one of our experienced and friendly lawyers.