Wills - Trusts and Kids
Discussion
Without getting too bogged down here I am after advice around the need for us to have a will, and also a trust for our kids. This follows various attempts over the years to organise a will through a "free service" through work. I did this a few years ago with Slater and Gorden where I did it myself using an online portal - I have no idea what that process was and the document that resulted makes zero sense to me. It has executors and guardians but it is in a different language as far as I am concerned and we had no bespoke advice. The wife did her own will through her work which is slightly different. Hence we now want to renew and do a mirror will which is consistent.
I ended up on a few calls this week where I basically feel like I am getting the hard sell. Wills have been offered for free but we are told me need some form of "tax benefit will" or similar and a "trust" for our kids, costing up to £5500. We are mr and mrs average in an average semi with 2 kids and some pets, no previous partners or baggage so it just doesn't sit right.
After much chat we got it down to 2 free wills (one each) and a £140 charge for the most basic of trusts which has minimal protection - but never the less apparently does mean that that the kids would inherit our estate and not lose money by tax / other government rules? We only have 1 house which is mortgaged and no other assets. Kids have just hit teen ages.
How essential is a will / trust in simple circs like this?
I ended up on a few calls this week where I basically feel like I am getting the hard sell. Wills have been offered for free but we are told me need some form of "tax benefit will" or similar and a "trust" for our kids, costing up to £5500. We are mr and mrs average in an average semi with 2 kids and some pets, no previous partners or baggage so it just doesn't sit right.
After much chat we got it down to 2 free wills (one each) and a £140 charge for the most basic of trusts which has minimal protection - but never the less apparently does mean that that the kids would inherit our estate and not lose money by tax / other government rules? We only have 1 house which is mortgaged and no other assets. Kids have just hit teen ages.
How essential is a will / trust in simple circs like this?
We’re in a similar situation and also got a hard sell on trusts.
My interpretation was you effectively sell your house to the trust so you no longer own it but your trust does.
My view is that it wasn’t worth the faff.
A basic will is important but marriage tends to cover the essentials. I suspect in time to come, unmarried couples will be afforded the same basic benefits.
My interpretation was you effectively sell your house to the trust so you no longer own it but your trust does.
My view is that it wasn’t worth the faff.
A basic will is important but marriage tends to cover the essentials. I suspect in time to come, unmarried couples will be afforded the same basic benefits.
Simon_GH said:
We re in a similar situation and also got a hard sell on trusts.
My interpretation was you effectively sell your house to the trust so you no longer own it but your trust does.
My view is that it wasn t worth the faff.
A basic will is important but marriage tends to cover the essentials. I suspect in time to come, unmarried couples will be afforded the same basic benefits.
Wow I never got given that detail, we got run through various issues such as the inheritance tax cap, what if scenarios with kids partners kids taking all and one sibling missing out etc - but it all felt scripted and impersonal. My interpretation was you effectively sell your house to the trust so you no longer own it but your trust does.
My view is that it wasn t worth the faff.
A basic will is important but marriage tends to cover the essentials. I suspect in time to come, unmarried couples will be afforded the same basic benefits.
If you're married (which it would appear you are), your house is worth £350K or more, you're leaving the house to your kids, and your total estate is worth less than £2million or so, then your kids can inherit £1million before IHT comes into the equation.
If you have a SIPP (and there's still money in it when you and your wife have both died) then your kids can use this money to pay IHT before Probate has been granted (this is all very new, and I'm waiting for the dust to settle before banking on this 100%, but it is my current understanding).
I looked into Trusts / Insurance Policies etc and decided that I'd be quite happy for my kids to pay IHT as they'll be getting £1million to split between them, plus 60% of everything over £1million.
The only reason for a trust that I can see is to see your kids through until they're 18 (or 21, or 25 or whatever age you think they'll be sensible). The bigger question here is who will look after them. The other thing to bear in mind is if both you and your wife die before your kids have full independence then it's highly likely that you'll both be under 75, so your SIPP is passed on unencumbered (i.e. no income tax to pay)
If you have a SIPP (and there's still money in it when you and your wife have both died) then your kids can use this money to pay IHT before Probate has been granted (this is all very new, and I'm waiting for the dust to settle before banking on this 100%, but it is my current understanding).
I looked into Trusts / Insurance Policies etc and decided that I'd be quite happy for my kids to pay IHT as they'll be getting £1million to split between them, plus 60% of everything over £1million.
The only reason for a trust that I can see is to see your kids through until they're 18 (or 21, or 25 or whatever age you think they'll be sensible). The bigger question here is who will look after them. The other thing to bear in mind is if both you and your wife die before your kids have full independence then it's highly likely that you'll both be under 75, so your SIPP is passed on unencumbered (i.e. no income tax to pay)
Ubiquitous2024 said:
The Gauge said:
Why are you wanting to get wills done free of charge?
Why wouldn't I when it is offered as part of jobs / insurance e.t.c.I've never had a good experience when having a free will made via my employer, just as you haven't either by the sounds of it,
They are usually done remotely and without ever speaking to anyone, and without absolute certainty that I've received the will that I wanted. Plus they have always insisted that I visit their office to sign it, requiring a trip to another city, and they they insist on storing the will. I wouldnt ever do a free will again,
Edited by The Gauge on Saturday 1st August 11:29
Ubiquitous2024 said:
Why wouldn't I when it is offered as part of jobs / insurance e.t.c.
Pay peanuts, get monkeys. Pay nothing, get nothing.
What you should be doing, assuming you’re serious, is finding a good solicitor experienced in estate planning. Look for one with a STEP qualification.
The very first question should then be “given our likely estate, and our wishes, what do we need to do?”.
It’s quite possible that you don’t need to do any of what you think you have to do. It sounds like you have a pretty simple and straightforward estate and the main issue will be whether your estate gets caught by IHT or not when the second of you and your wife passes.
The fact you have a will which you do not understand is a massive red flag. You have no idea if it does what you want your will to do.
The Gauge said:
Because as you have already found, they are usually crap.
I've never had a good experience when having a free will made via my employer, just as you haven't either by the sounds of it,
They are usually done remotely and without ever speaking to anyone, and without absolute certainty that I've received the will that I wanted. Plus they have always insisted that I visit their office to sign it, requiring a trip to another city, and they they insist on storing the will. I wouldnt ever do a free will again,
Nothing is free, and there's a chance professional executors have been appointed with their fees agreed in the free will often based on a % of the estate value. I've never had a good experience when having a free will made via my employer, just as you haven't either by the sounds of it,
They are usually done remotely and without ever speaking to anyone, and without absolute certainty that I've received the will that I wanted. Plus they have always insisted that I visit their office to sign it, requiring a trip to another city, and they they insist on storing the will. I wouldnt ever do a free will again,
Edited by The Gauge on Saturday 1st August 11:29
The Gauge said:
Because as you have already found, they are usually crap.
I've never had a good experience when having a free will made via my employer, just as you haven't either by the sounds of it,
They are usually done remotely and without ever speaking to anyone, and without absolute certainty that I've received the will that I wanted. Plus they have always insisted that I visit their office to sign it, requiring a trip to another city, and they they insist on storing the will. I wouldnt ever do a free will again,
I get that but you could write a will on the back of a fag packet and if you died it would still be honoured. We just want something rather than nothing. If the above re 1 million is true then it seems we would be ok, but half the issue is that we are advised something different every time so its hard to know what is accurate and what is not.I've never had a good experience when having a free will made via my employer, just as you haven't either by the sounds of it,
They are usually done remotely and without ever speaking to anyone, and without absolute certainty that I've received the will that I wanted. Plus they have always insisted that I visit their office to sign it, requiring a trip to another city, and they they insist on storing the will. I wouldnt ever do a free will again,
Edited by The Gauge on Saturday 1st August 11:29
MisterJD said:
Nothing is free, and there's a chance professional executors have been appointed with their fees agreed in the free will often based on a % of the estate value.
On the call we had this week we have named executors / guardians and they said it would take a couple of months to draw up. omniflow said:
If you're married (which it would appear you are), your house is worth £350K or more, you're leaving the house to your kids, and your total estate is worth less than £2million or so, then your kids can inherit £1million before IHT comes into the equation.
Only if his wife has already died and left everything to him. Then he has her unused IHT allowance, plus his own. If his wife is still alive, and he dies and wants to leave everything to his kids, the kids can only inherit £500K before IHT comes into effect. For now he should be leaving everything to his wife and she should have a mirror will. Then an add on at the end saying if they both die together, everything to the kids. No need to complicate things at this stage.
Edited by TwigtheWonderkid on Saturday 1st August 12:45
TwigtheWonderkid said:
omniflow said:
If you're married (which it would appear you are), your house is worth £350K or more, you're leaving the house to your kids, and your total estate is worth less than £2million or so, then your kids can inherit £1million before IHT comes into the equation.
Only if his wife has already died and left everything to him. Then he has her unused IHT allowance, plus his own. If his wife is still alive, and he dies and wants to leave everything to his kids, the kids can only inherit £500K before IHT comes into effect. For now he should be leaving everything to his wife and she should have a mirror will. Then an add on at the end saying if they both die together, everything to the kids. No need to complicate things at this stage.
Edited by TwigtheWonderkid on Saturday 1st August 12:45
In my case, "you" meant the OP and his wife, and "your estate" meant his and his wife's joint estate.
There is also the unwritten assumption that on first death, everything goes to the Spouse (including IHT allowances) and it's only on second death that the kids get anything from the will. Given that the Spouse inherits the entire unused IHT allowance, there is absolutely no benefit from an IHT perspective in leaving anything to your kids after the first death. It's far better to leave it up to the discretion of the surviving Spouse once they've taken stock. Obviously if you're considering trusts and tax avoidance strategies, then ignore this bit.
A will is essential, a trust depends on your personal circumstances in terms of total value of your estate and what your intentions are. If you think your estate is less than £1M and you are each leaving everything to each other (wife) then a simple set of mirror wills saying that and in the event you both go then to the kids is likely all you need (as you likely won t be subject to a big (or any) IHT bill). You should consider what happens if you die before they are adult though (who would look after them and what provision might you leave for that person or persons). I am not a financial adviser, take professional advice as per other posters recommendations.
Edited by Steve Campbell on Saturday 1st August 13:00
I would just go and see / contact a solicitor or a will writing company together and get both wills drawn up properly.
Whether these differ in some ways or are mirrors of each other is academic.
You can diy but this way they will be right.
Don’t get the solicitor to be executors ( their charges will be eye watering ) but instead try and pick sensible family members or good friends.
As your children are presumably young teens you also need to consider guardianship especially should you both die together.
I would also suggest you consider both getting LPA’s done at the same time.
In many ways these can be even more important than a will.
Better to have and not need rather than the other way round.
One final tip on the will - leaving money to charities is admirable and won’t be your issue but the pressure they can then put on Executors to sort out probate and the like quickly can be interesting.
Whether these differ in some ways or are mirrors of each other is academic.
You can diy but this way they will be right.
Don’t get the solicitor to be executors ( their charges will be eye watering ) but instead try and pick sensible family members or good friends.
As your children are presumably young teens you also need to consider guardianship especially should you both die together.
I would also suggest you consider both getting LPA’s done at the same time.
In many ways these can be even more important than a will.
Better to have and not need rather than the other way round.
One final tip on the will - leaving money to charities is admirable and won’t be your issue but the pressure they can then put on Executors to sort out probate and the like quickly can be interesting.
Due to my experience of family bereavements I consider that I am familiar with a standard format for a mirror will.
I have experience of hugely complex wills of many many pages which effectively say nothing and other wills comprising simple succinct understandable texts which I prefer.
On the basis that any will is better than no will I used an online free will writing service to create mirror wills for myself and Mrs Actual.
The service I used was https://www.lawdepot.co.uk/
The will writing asked the questions and created the standard texts but it restricted the downloading and printing of the final documents and so I performed a PDF print of each individual page (5 pages each) and then cut and pasted the txt into Word and with a little formatting produced the Wills which have been signed and witnessed.
I have experience of hugely complex wills of many many pages which effectively say nothing and other wills comprising simple succinct understandable texts which I prefer.
On the basis that any will is better than no will I used an online free will writing service to create mirror wills for myself and Mrs Actual.
The service I used was https://www.lawdepot.co.uk/
The will writing asked the questions and created the standard texts but it restricted the downloading and printing of the final documents and so I performed a PDF print of each individual page (5 pages each) and then cut and pasted the txt into Word and with a little formatting produced the Wills which have been signed and witnessed.
Get a good solicitor to do the will WITH you. WITH as opposed to remotely. They will discus the ins and outs, legal requirements, protection measures for the estate and liabilities so you make good decisions and have the right protections built in for how you want your estate passed on and protected ( HMRC rules and limits, clear division of estate to beneficaries etc).
Separate to the will that sorts things after you have died, but extremely important for while you are still alive, get Power of Attorney set up. Both Financial and Health versions, making sure the right people are appointed as Trustees.
Separate to the will that sorts things after you have died, but extremely important for while you are still alive, get Power of Attorney set up. Both Financial and Health versions, making sure the right people are appointed as Trustees.
From ( an expensive) experience do not use banks or other such to become executors . Do not use such organisations to draw up any will. They will certainly include clauses such as “ fees will be calculated at the time)
Use an independent solicitor and responsible independent executors.
Many threads exist on the poor performance of Probate companies, extended timeframes with huge costs on simple estates
Use an independent solicitor and responsible independent executors.
Many threads exist on the poor performance of Probate companies, extended timeframes with huge costs on simple estates
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