Inheritance Matters | Tax and Planning | Alan Steel Asset Management
Only 36% of British adults have a will
Thinking about inheritance matters and what might happen to us when we die is something most people try to avoid.
The problem with shutting out all thoughts of death is that it can have a detrimental impact on your nearest and dearest when you're no longer here. Unfortunately we've no way of knowing what's in store for us in life, but there are things you can do to make inheritance matters easier to sort out for those left behind.
The following statistics give a good insight into the scale of inheritance planning and tax problems:
- 80% of British adults believe all adults should be required to have a will yet only 36% have actually written one*
- 32% of adults have had a dispute over money or property following someone's death.*
By not seeking professional advice and having a will in place, your loved ones could be left facing an unwanted inheritance tax bill or other difficulties.
Why are we so reluctant to talk about death?
Death is an inevitable fact of life. However, in Britain there is a general reluctance to discuss passing away or planning for the end. This is demonstrated by the fact that almost two thirds of British adults haven't got a will in place.
Many people keep putting off talking about death or organising a will until 'another day' but then day-to-day life gets in the way and it never happens.
It doesn't take long to put your plans in writing
When your time comes and you pass away, it will be an upsetting and difficult time for your friends and family. By opening up and talking about death and putting your plans in writing, you'll ensure they don't have too much to sort out while they're grieving.
Inheritance tax and planning issues are something you may never have thought about. A quick chat with an adviser can ensure your family members won't have to pay more tax than they need to when you're no longer here.
Your digital legacy when you die
Because of social media platforms such as Twitter and Facebook, a person's digital legacy also needs to be thought about. While 27% of British adults have posted online tributes to someone on their death* - 71% have not considered what will happen to their own digital legacy.*
If you use any social media sites, you might want to consider sharing your login details with someone close to you. It can be incredibly upsetting for family and friends to see active profiles when the person in question has died.
It's important to have these kinds of conversations around death, especially if you have strong views on what you'd like to happen to your digital footprint when you die.
How to sort out your affairs
Setting some time aside for inheritance planning and sorting out your financial affairs now means:
a) You don't have to think about it again any time soon.
b) Your instructions will be clear and easy to understand when you pass away.
c) It will be less stressful for those left behind to sort out your affairs.
Here's a five step action plan. Seize the moment and start the process today. Discussing death can be difficult but think about how your family will cope with managing your affairs if you've left no instructions.
1. Don't just think about who you want to leave things to. Write a will.
2. Appoint an executor who understands what being an executor means and ask their permission.
3. Organise your assets and your paperwork so everything is easy to find.
4. Identify who can help. For example the RSPCA/SSPCA or Dogs Trust if you have a pet.
5. Have Power of Attorney in place. This can apply to your financial affairs and also for your care and health.
Like it or not, death is a part of life. As with all major events such as buying a house and changing careers, it should be planned and discussed in advance.
It may feel uncomfortable to talk about a time when you're no longer around, but it doesn't have to be a lengthy discussion. Putting your affairs in order will give you peace of mind then you can get on with enjoying your life again, safe in the knowledge your wishes will be carried out.