Estate Planning

What is Estate Planning?

Everyone has an estate and this comprises of ‘assets’. Your assets include your money, possessions and any property you own. Calculating the total value of your assets is a vital part of estate planning and it will help you to determine future Inheritance Tax (IHT) liabilities. You need to consider what happens to your estate when you pass away, especially if you want to leave a legacy for your children. Effective estate planning enables you to leave the right money to the right people. We call this ‘bloodline planning’ – did you know that it is not an automatic right for your children to inherit from you?

Inheritance Issues to Consider

Although having a valid Will is a good step, it might not be enough to protect your estate from threats. If you have remarried and your partner has children, there is a risk that previous children may not inherit from your estate.

Say you have passed away. Your Will has been fulfilled and your family have moved on. Your partner finds another person to spend their life with and, in turn, they marry (or enter a civil partnership). The new legal couple now share assets including your home. You may have intended for your property to go to your children once your partner passes away. However, since your partner has now remarried, if their spouse already has children – or they have children ­­– the likelihood of your property going to your own children is slim. This could even result in complete disinheritance.

One method is to place your assets into a Trust. This is a flexible way of allowing you to protect your assets while you are alive, as well as after you die. Trusts offer many benefits including protecting against Inheritance Tax (IHT) and care home fees.

Asset Protection or Lifetime Trusts

The Asset Protection Trust – or ‘Life Interest’ Trust – is designed to allow you control over how your assets are left. Although you may wish that the asset value of your property is left to one person (known as a ‘beneficiary’), you may not desire this to be at the expense of another person’s right to enjoy this asset for as long as is required.

For example, you may choose to leave your share of your home to your children. However, you may intend for your partner to carry on living in the property for as long as they wish, without the threat of your children deciding one day that they want the money and force the sale of the property.

Call Strathmore Wills today for free advice or to arrange your no obligation telephone or face to face appointment

on 01708 300 312, or, fill out the Appointment Form here.

1

Download Your Free E-Book Here…

    I consent to being contacted by Strathmore Wills. Details available in our privacy policy here.