A lot of people avoid writing their own wills because, well, it’s just not very fun to do.
But if you want to have your spouse, children or other relatives to inherit your assets, you need a well-written will. The absence of such can only complicate things.
Get started with your will in four steps:
List down all your assets.
The first thing you should do is to have a clear understanding of what you have.
Make a list of all your significant assets, including land and properties, cars, jewellery, bank accounts, business assets and even precious artworks.
If you and another person co-own a property, your share of the property will be automatically passed to the co-owner or your spouse (check your state’s laws about this).
Be specific about who gets what.
Choosing the right beneficiaries for the right assets is essential (and complicated), so make sure you do this step carefully.
Let’s take a look at two asset types and what you need to know when naming beneficiaries.
Life insurance – Proceeds from life insurance plans are given to the beneficiary quickly. Funds are transferred weeks after the proof of death is established. Now, think about who may need immediate access to funds when you die, as they may benefit the most from your life insurance. Would your partner still be able to pay bills or a mortgage without your income? Similarly, would your parents find finances challenging without you around?
Assets distributed through a will – When you die, your assets will go through a probate. Probates have a reputation for lasting just short of forever. While some estates close or settle within a few weeks, some take years. Make sure the beneficiary of any property is in a position to wait.
Be mindful of inheritance taxes.
Inheritance laws vary across the constituent countries of the UK. You might want to prepare for the eventuality if you think your estate might become liable for inheritance or estate taxes down the road.
You can take steps now to mitigate the impact of taxes or even eliminate them. There are reliable online sources, but if you’re just unsure how to do this, you can approach estate and trust management firms.
Choose a guardian for your minor children.
If you have minor children, you should disclose their full names and birthdates in your will. Then, choose a family member, a close friend or anyone else you feel who are capable of looking after your children in the event of your death.
You can appoint more than one guardian. If you want, you can name three guardians in the order of your preference, just in case one of them is unable or unwilling to act.
After you’ve done your will, keep it in a safe place. Make sure a beneficiary or the executor is aware of its location and how to access it.
These are four essential things you need to know when writing your will. Make sure to revisit and update your will every few years to reflect any changes.