Why Is Estate Planning Important When Making A Will?

Image of two model houses in the grass. New house and old house.

Timms Sara Hilliard details why advice on estate planning is important when writing a Will in her latest blog…

Most people think that estate planning is just for the very wealthy in society. However, I would say that all families should at least consider a plan. For example, thought should be given to what would happen if a main breadwinner should pass away suddenly or if there is a win on the lottery or premium bonds which increases the value of the estate.

The Importance Of Estate Planning

You may end up with a very straight forward Will, but understanding the impact of, for example, how your assets are held in your estate, who actually owns the assets and how taxation will affect the estate, are all extremely important considerations. Understanding these considerations will also assist you in recognising when you should be looking to update your Will.

People often do not realise that if they hold monies in joint bank account or investment or even if they own property jointly, then that asset would immediately pass on death to the surviving joint owner and not via a Will. This may not even be a spouse or a partner and may not be the required result.

Considering Tax Consequences

Advice on tax consequences is also important. For example, including age contingencies for children other than your own in a Will can result in an increased tax burden and expensive administration costs. These increased costs and burdens may outweigh the benefits of using a trust.

If you do have young children, a parent should always plan for the unthinkable. To ensure your children are cared for in a manner of which you approve, you will want to name their guardian or guardians in the event that both parents died before their children have turned 18. Without such instructions in a Will, the courts may have to step in to decide who will raise your children.