Yahoo Finance Top tips on making a will and protecting yourself
Having a legally valid will is key to ensure your wishes are clear about who should benefit from your estate after you die.
If someone dies without a valid will in place, then the law will decide who inherits everything that person owned. This includes any property and its contents, money held in bank accounts and investments, cars, personal possessions, and even pets.
If you don’t have a clear and watertight will it could be legally challenged. The number of contested wills going to the High Court rose by 62% in 2019.
Sarah Coles, personal finance analyst at financial services company Hargreaves Lansdown, says: “With record numbers of contested wills reaching the High Court, your will may not be worth the paper it’s written on. If you’ve made a will, you’re doing better than most people — because more than half of people in the UK haven’t.”
But soaring numbers of contested wills mean it’s vital that your will is as watertight as possible.
“Second and subsequent marriages mean more complicated family relationships, while higher house prices and investment values mean there’s more at stake. Add in the fact that older people are increasingly likely to have had some kind of help with care from at least one family member, and it’s hardly surprising the number of contested wills is on the up,” Coles said.
Read more: 'Ethnicity gap' exposes large inequalities in income for ethnic minority pensioners
So how can you write a watertight will and protect yourself?
Follow the rules
In order for your will to be valid it must be in writing, signed by you in the presence of two independent witnesses, who must also sign it in your presence. Beneficiaries of the will shouldn’t act as witnesses or they lose their right to the inheritance. It’s often sensible to have a lawyer draw up your will, so you don’t accidentally break any rules.
Another rule concerns your mental capacity to make the will and understand the effect it will have. If you have an illness that can cause mental incapacity, have your mental capacity assessed by a medical professional and a medical professional witness the signature.
Be accurate
Make sure the wording of your will is accurate and correct. In one case of a contested will a family ended up in court after a woman said she was leaving her “principal” car to family member — without confirming whether she meant the priceless antique or the family run-around.
Be clear and make sure the will doesn’t contradict itself. Any ambiguity will open you up to legal challenges.
When the will is drawn up, ensure the will writer keeps notes which make it clear what your instructions were, what their advice was and why final decisions were made. This makes it less likely to be challenged as everyone can see a clear rationale for why the final will was drafted the way it was.
Keep it up to date
If there is a change in your family situation, such as a new partner who you would like to be a beneficiary, make sure you keep your will up to date. This makes it less likely to be challenged by someone feeling unfairly treated.
Explain why you’re leaving your estate this way
Don’t put this in your will directly as it will become public and could provoke further tensions. You can write a declaration or an ‘Inheritance Act Statement’ that you keep alongside your will explaining why you’re leaving your estate this way and why anyone is excluded. This won’t prevent people bringing a claim against the will, but will be useful if they do.
Read more: Why retirement isn’t always easy — and how volunteering can help
Discuss your decisions with your family. This isn’t always possible or easy, but will mean that everyone is aware of the contents of the will beforehand and will avoid any unpleasant surprises ending in legal battles.
Do what you promised
If you’ve already promised to leave somebody something specific in your will, and they’ve based life decisions on it, they can challenge your will on this alone. By following through on your promises in the first place you could save everyone a lot of distress and expense.
Consider gifts before you die
The best way to be absolutely sure people receive exactly what you want them to have, is to give gifts before you pass away. This also has inheritance tax benefits because you have an annual gift allowance of £3,000 ($3,845) a year that will come out of your estate immediately for inheritance tax purposes. You can also give gifts of any size that will pass out of your estate after seven years — helping you keep within the nil rate band, the threshold for inheritance tax.
Include a ‘no contest’ clause
A ‘no contest’ clause states that a beneficiary will forfeit their inheritance if they challenge the will. If a challenge to the validity of the will is successful and the whole will is found to be invalid for any reason, the no contest clause won't apply but it will strengthen your will against challenges in the first place.
Read more: Number of older workers rising in the UK
“To ensure your will gives money to the people you want to benefit, at the right time, and in the way that suits you best, you need watertight arrangements. During Free Wills Month in March, if you’re aged 55 or over, and have relatively simple arrangements, you could get it sorted by an independent professional without charge,” Coles said.
