Bereavement is one of the most stressful life events we will encounter – and the last thing we would wish for our loved ones would be a nasty surprise concerning their inheritance at a time when grieving is challenging enough.

Writing your Will may not be top of your To Do list, but there are certain things you may be taking for granted, which need your urgent attention.

This is why focusing on getting your affairs in order now is the best approach. You do not have to wait until you are older, or until you are suddenly unwell, to ensure that all is in order with your estate planning.

Who will sort out your assets and possessions (your estate) after you die?

Who would you really trust to look after your children – and should these be the same people who look after your assets for them? What if they are in another country?

How can you prevent your children being [accidentally] disinherited by a future marriage or partnership of your spouse or civil partner?

How much will your family actually receive of that ‘lump sum’ promised by your life assurance provider in exchange for those hefty monthly premiums? And how can you make sure it is exactly what you thought?

These matters need your attention – the sooner the better. A simple awareness of stark legal realities can make all the difference between the naturally hard grief process, and an entirely avoidable traumatic experience that creates unnecessary further heartache for your family.

Whatever your stage of life, you will almost definitely need a Will. The structure of the Will may differ depending on your current circumstances, but these three key points should help you better protect your assets for your family and loved ones when the inevitable happens.

1. You can leave your assets to your partner and also protect them for your children

There is a common misconception that if you trust your partner, it will be a sign of mistrust – and possibly rather offensive – not to leave it up to them to look after your children financially if you are the first to die. This is not true.

The simple fact is that, on too many occasions, children are disinherited accidentally. We have all heard of the awful ‘Cinderella’ scenarios in which a new stepparent manipulates the surviving spouse and cruelly arranges for a child to be cut out, possibly in favour of their own child(ren). However, aside from this threat, which we mostly feel we would see coming (which is, of course, debateable, given the increasing reports of ‘predatory marriage’), another seemingly innocuous scenario is far more likely:

FACT: When you say “I do”, your Will becomes invalid. Not the most romantic result of marriage, but one of the very few guaranteed ones.

Unless you have brought a new Will to the occasion, which some do, and sign it there and then with two witnesses, your children’s inheritance has suddenly become immensely vulnerable – and will remain so until another Will is put in place. If you do not remember to do so, you will die ‘intestate’, which means that certain things will automatically happen to your estate, none of which you might intend – and almost definitely not what the deceased parent of your children intended. The majority of your assets will pass to your new spouse, and, in time, quite possibly to their children.

BETTER FACT: There is a solution – the Life Interest.

Incorporating a Life Interest in your estate for your spouse or civil partner will leave them free to marry or enter a new partnership and enable them to benefit from your assets – if you want them to – while keeping those assets safe for your children. On a separate note, the Life Interest will also benefit from spouse exemption from inheritance tax in the same way as leaving assets directly to a spouse or civil partner. So it caters for both asset protection and tax mitigation.

2. Paying for life assurance does not necessarily mean your loved ones will receive the sum assured

This, quite understandably, comes as a shock to many. But there is no worse time for the shock to be experienced than after you have died.

So… you’ve had the discussions with your significant other about affordability and whether it’s really worth it; you’ve approached a life company and told them what you want; and you’ve received some paperwork from the life company, which you thought confirmed that it was all sorted out. You’re busy and you didn’t really read it because it is a reputable insurance company and you assume it’s done and dusted. After all, you’ve paid your first premium, so surely that must mean that you will receive what you’re paying for if you die. Not necessarily…

FACT: Unless your life assurance is written into a Trust, it will form part of your estate, and it will pass with most of your other assets, via your Will, and will be vulnerable to inheritance tax in the same way as your other assets.

If spouse exemption is relevant to your estate, this will certainly help (unless you and your spouse die together, or you have differing domiciles for inheritance tax purposes). But if you are not married or in a civil partnership, the lump sum you have been paying for with those premiums will be a lot less than your loved ones were expecting.

BETTER FACT: Assigning your life policy into a Trust for the benefit of your loved ones will avoid that 40% tax charge (and may also build in some asset protection, depending on the type of Trust you choose).

3. Lasting Powers of Attorney cease when you die

Every adult, whatever their age or state of health, should have Lasting Powers of Attorney in place. These documents allow you to choose – now – who would be in charge of your health and care, and your finances, if you were to have an accident and lose mental capacity, or if you were to lose capacity gradually as a natural result of the ageing process, or through illness. If these choices are not made while you have capacity, someone could be given such powers over your health and finances if you were to lose capacity. This may or may not be the person or people you would have chosen – and, having lost capacity, you would not be able to make any change.

However, once your Lasting Powers of Attorney are in place, it is important to remember that they only deal with your assets and affairs while you are alive. As soon as you die, these documents cease to have any effect, and your selected attorneys (the people you have chosen to act on your behalf) are not permitted to manage your property or finances, or make any funeral arrangements. This is where your Will becomes the salient document.

FACT: Your Lasting Powers of Attorney appoint people to manage your finances and care while you are alive, and your Will appoints people to manage your assets and affairs after your death.

BETTER FACT: Having both Lasting Powers of Attorney and a Will in place is a weight off your shoulders, and a very worthwhile investment – for you and for those who would either have to assume responsibility for you (while you are alive) or handle your estate after your death.

If you would like more information on any of the above, please contact our Partner and Head of Wills and Lasting Powers of Attorney for North London, Charlotte Baden-Powell (TEP), by visiting: