November sees both International Stress Awareness Week and Talk Money Week in the diary. These two important awareness events are closely linked, with financial issues often a major source of stress and mental health problems.
A staggering 56% of adults in the UK haven’t made a Will. So how can planning ahead with Adroit’s employee benefits make for more positive financial wellbeing for your people and those they’re closest to?
What is estate planning?
Estate planning helps people to create greater financial security in the future for themselves, their families and others they care about.
A will is vital, making sure that a person’s estate – from a car and home to savings, investments and objects important to individuals – is distributed according to their wishes, protecting loved ones and benefiting only those your people choose.
Estate planning starts with a discussion around goals and priorities. For example, providing a continuous income for your spouse, paying for a grandchild’s education, or protecting assets in case of a future divorce.
With goals identified, estate planning experts explore the most practical and tax-efficient options for the estate, structuring estate plans to suit an individual’s needs.
Why consider estate planning & making a will?
Following a death, an estate may be subject to Inheritance Tax or Capital Gains Tax. In fact, more and more estates are now subject to Inheritance Tax as a result of inflation and rapid increases in house values.
Professional estate planning can minimise the tax bills those receiving an estate will have to pay, making sure that estates benefit the people an individual cares about most.
Estate planning and making a Will gets affairs in order, making sure that those left behind know what to expect and creating long-term financial security for families, saving time and legal costs further down the line.
Estate planning with Adroit’s advisors
Estate planning considers key aspects of financial and personal affairs, including:
- Making a will
Making a will gives reassurance that those left behind after a death will be able to manage financially. Without a Will, an estate may not be shared as an individual may have wished.
For example, unmarried partners and those not in registered civil partnerships have no automatic right to inherit the estate of their partner if they die (this excludes anything owned in joint names). Those inheriting an estate may also be faced with a large tax bill if an individual dies intestate (without a Will).
Expert estate planning may be able to minimise Inheritance or other taxes for named beneficiaries.
- Lasting Powers of Attorney
Lasting Powers of Attorney give permission for a trusted person (or people) to make decisions on an individual’s behalf if there comes a time when they’re unable to make decisions themselves.
A spouse or next of kin isn’t automatically entitled to make decisions relating to a person’s health, welfare and finances if that person loses mental capacity.
Having LPAs in place makes sure that decisions will be made in an individual’s best interests by people they trust.
- Inheritance Tax planning
The current Inheritance Tax threshold is £325,000 which means no tax is payable on the value of an estate up to and including this amount (called the ‘nil band limit’).
When the value of an estate exceeds the nil band limit, the amount above the limit is taxed at 40% (at current rates), unless the estate has been left to a spouse or registered civil partner. The recent Budget contained significant changes to the Inheritance Tax regime, including changes to how pensions are treated, business and agricultural property reliefs.
Professional estate planning is necessary, not only to plan for tax efficiency in the future but to review an individual’s existing arrangements in light of the recent announcements.
This article has been prepared by Adroit Legal Services and is not intended to constitute legal or financial advice.
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Planning for the future & saving on legal costs with Adroit
Established in 2015, Adroit connects your people to quality-assured, affordable and accessible legal services, and practical and emotional bereavement support, from recognised, trusted and experienced experts.
Legal specialists throughout the UK are tried and tested, delivering honest advice at every stage of life to protect the interests, families and wellbeing of the people important to your organisation.
Benefit clients receive a free simple Will or free Will review, as well as access to specialist estate planning experts who offer free consultations and discounted fees on their services.
Contact Adroit Legal Services to find out how we help our clients to protect their peoples’ wellbeing with access to quality-assured, great value legal services.
