(Prince was worth hundreds of millions of dollars and died without a will. America’s Inland Revenue Service (IRS) will collect handsomely, perhaps 40%)
By Alan Steel
I’m always amazed by the number of folks who still don’t understand the basics of money, and how to protect it and make it grow.
Here’s an example….
A man dies suddenly at the age of 57 due to complications associated with diabetes.
He lived in a house with his now newly widowed wife, and only managed to accumulate about £70k into their pension pot (another reason for grief).
As it turns out he has a life assurance policy…but…because the policy wasn’t written properly the wife can’t access the funds until the estate receives a legal document called “Confirmation” (In Scotland).
That process can take at least six months. Jings, I know of an estate that still had not received Confirmation two years later (probably thanks to a useless lawyer).
If you fail to make a Last Will and Testament or if you draft an invalid one, you will be declared intestate after you die. If this happens, the intestacy laws of Scotland will determine who gets what from your estate. Your estate will go to probate and the court will appoint an administrator.” (Scottish Wills)
Now, if the policy had been set up under a simple (and free) trust in favour of the wife, the money would have been paid out tax-free when the death certificate was issued, in a matter of days.
More importantly, that money would not form part of the estate; in other words, it wouldn’t be taxed with what remains.
That makes for less going out the door into the Government’s coffers and through lawyer’s fees.
So how many people know about these things?
Not many, it seems.
Data from charity Will Aid suggests the following:
- There has been slight decline in the proportion of people in the UK saying they have written a Will
- This means that, of the 51 million adults living in the UK, 27 million of them (53%) do not have a Will
- In the oldest age group (75-84), the percentage of respondents with a Will has increased from 82% in 2014 to 90% now. The 45-54 age group has increased by more than 4% to 47% while the 65-74 age group has also seen a small increase from 72 to 74%.
- People in the South of the country, including the South East and the South West have the highest percentage of people with a Will, followed by East Anglia.
- Residents of Wales have the lowest proportion of people with a Will – 33%
Believe me when I tell you that the Government and lawyers wring their hands when people die intestate.
So if you really want to provide for your family, get it right before you snuff it.
Take advice from folk who hate the taxman and “middle men” as much as you do, and save thousands of pounds and months of despair for those you leave behind.
After all, what was yours is now your loved ones money.