About this series of articles
This article is part of our series on wills. We explain the most relevant legislation and combine it with practical considerations. We hope that it both thorough but also easy to digest.
Why you should make a will
The reason to make a will is to control how your estate is divided. But it isn't just about money.
Your will is also the document in which you appoint guardians to look after your children or your dependents.
The place to start is to look at what happens if you don't make a valid will (in legal terminology, if you die intestate).
What happens when you die intestate
Two administrators are appointed by the Probate Registry, a division of the High Court, to wind up your estate. They have the same function as executors (people you appoint to wind up your affairs), but they are appointed by the Court.
Any person may apply to be appointed as an administrator. To be appointed, an application must be made to the Probate Registry. Occasionally more than one person or one set of people apply. In that case a judge must decide who has priority. Generally it is clear from the relationships of individual people who has the best qualification. Here is the order of priority:
- your spouse (or if he or she has survived you but dies before obtaining Letters of Administration of your estate, his or her personal representative)
- your children (or, failing them, your grand children)
- your father and mother
- your full brothers and sisters or their children
- your half brothers and sisters or their children
- your grandparents
- your uncles and aunts or your first cousins
- your half blood uncles, aunts and first cousins
- The Crown
- your creditors
Relatives by marriage do not qualify in any other category.
The rules on intestate inheritance
The law divides your relatives into classes such as children, siblings, grandparents, and so on. All members of any class inherit in equal shares.
Once even one person has been identified in a class, then all lower priority classes are excluded. Your assets are divided among however many or few members there are of the priority class. There is an exception to this for close family as you will see below.
If a member of a class dies before you and leaves issue (children or grand children) who survive you, the issue inherit equally between them the share that their parent would have inherited had he survived you.
If anyone entitled to inherit is under the age of 18, then the inheritance is held in trust for them until they either reach the age of 18 or marry under that age.
If your spouse does not survive you by 28 days your estate is distributed as if he or she had not survived you.
Who gets the money?
Provided your spouse or civil partner survives you by 28 days, and there are no persons in any of the above categories, then he or she will inherit your entire estate.
If there are any surviving children, grandchildren, parents, brothers or sisters, he or she will receive less and people in these classes will inherit some of the estate.
Your spouse is entitled to your personal chattels (which we call 'possessions') in any event and whoever else is alive.
Your spouse is also entitled to receive what is known as the 'statutory legacy' and interest from the date of your death at the rate of 6 per cent until payment. The statutory legacy at the time of writing is £250,000.
There are further rules for division of your estate beyond that.
So, why make a will?
Coming back to the central question of why make a will, the reason is to (as far as possible) override the law that defaults if you die intestate. Reasons why you might want to do this are:
So as not to give your estate to an estranged husband or wife
Your surviving spouse comes top of the list of beneficiaries if you leave no will. So, if your marriage has broken down but no divorce has been finalised, your surviving spouse (now your 'ex') might inherit the whole or a share of your estate.
So as not to ignore your unmarried life partner
If you live with someone with whom you are not married nor in a formal civil partnership, and you die intestate, your life partner has no automatic right to inherit anything from you.
To allow your spouse or partner to keep living in your home
If your home makes up a high proportion of the value of your estate, your surviving spouse or life partner might be compelled to sell it to fund payments for tax or your bequests to children or other relatives.
To avoid paying more tax than necessary
Do you really want to give your money to the state?
At the time of writing this article, inheritance tax kicks in at £325,000. That includes gifts you have made in the seven years before your death.
The fact is that if you own your own house, and have a mortgage protection, endowment or life policy, and you are contributing to a pension, you could well find that under intestacy, your estate may well pay IHT on much of what you leave.
You probably know that what your spouse or civil partner (but not an unmarried partner) inherits from you is free from inheritance tax on your death, but in the longer term that is of no help. When he or she dies, the value will just make his or her estate even larger.
To control who doesn't receive your estate
It can be easy to disinherit the people about whom you care the most, or who need your estate the most.
If you die intestate while you are married, your estate passes to your spouse. If he or she remarries, then dies intestate, his or her estate (which would include yours) would pass to his second wife or her second husband.
He or she might leave the estate to children (all from his or her first marriage to someone else). The remainder of your estate would be inherited by the children of someone you may have never met.
The only way to ensure that certain people receive certain gifts (particularly ones with sentimental value), is to create a will or gift the items well before you die.
To nominate who will look after any young children
This important issue cannot be covered entirely in your will, of course.
Ideally, you should consult with friends and relatives and obtain their acceptance of whatever decision seems best for your family. Your will remains the best place to record this.
Suppose both parents die in the same accident. Without this record, your children could be brought up by people you consider quite unsuitable, or even taken into care. You may be interested in reading our articles that cover guardians and trustees and making sure your children are provided for.
If you are an unmarried mother, you can appoint a guardian to your children by will. This is important because your children's father does not necessarily have the legal powers of a parent nor become their guardian.
Reasons why people don't make a will
You think you have only debts
Most people are worth more than they think. Payouts on life insurance policies, long forgotten mortgage support policies and other endowment policies may be worth substantial sums on your death. You may have pension provisions with a lump sum value on death.
You are young and will not die for a long time
With luck, you may be right. But you would make a mistake to view a will as something for old people. Treat it more as insurance. It is a very low cost cover for the horrors that could occur if you did die without a will.
Wills are expensive to make
If you have a complicated estate worth a vast sum, then you will want a level of estate planning that does come at a cost. However, the average person does not need to have a solicitor spend hours drawing a will. There are many ways to write a will without using an expensive solicitor (see below).
We encourage you to make a will
Net Lawman offers three will templates for free. We suggest you look at these to see if any are suitable. We expect that they will be for 60% of the population. Alternatively, you could use our online will writing software (also free) if you would prefer not to have to edit a template.
There are other free alternatives. Many charities offer free wills (they pay for the cost) to over 55s in the hope that you leave them a gift in return. Trade unions do the same.
If you wish to buy a template, Net Lawman offers a further six for more complicated estates for sale.
You can also buy wills from online will writers, or solicitors. Make sure that you don't end up agreeing to have the same firm do your probate work in return for a cheap price. The future cost of probate is likely to be much higher than the firm was bidding competitively.
We recommend that you read about the meaning of the words in the document next. However much anyone tries to minimise use of legal jargon, there are some terms you just can't avoid.
We strongly believe that everyone should have a will, and that cost shouldn't be a reason not to. We provide some of our simpler will templates for free (likely to be suitable for most people) with no catches or conditions.
There should be one in our collection to suit you. If you are not sure about which one is best, read about where to start.