Everything You Need to know on Estate Planning in the UK
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Table of Contents
- What is Estate Planning
- What is the Importance of Estate Planning
- Why do I need an estate plan
- 9 benefits of estate planning
- Importance of wills and estate planning
- Information needed for estate planning documents
- How Much Does Estate Planning Cost in the UK
- How much should basic estate planning cost
- How to Become an Estate Planner in the UK
- What do estate planners do
- How much does an estate planner make
- Will vs Trust - Which is Better for Estate Planning
- Should you choose will or trust for estate planning
- Wills and Trusts in Estate Planning
- Frequently Asked Questions
- Key Takeaways
What is Estate Planning?
“The arranging for the disposition and management of one’s estate at death through the use of wills, trusts, insurance policies, and other devices” – Merriam-Webster
While estate planning is not a pleasant thing to think about, you must be worried about what will happen to your assets and loved ones after you pass away.
A good estate plan has five components –
You would need an estate planning guide if you are unsure about your estate planning.
This is where we come in. We have expert estate planning services and advice for you.
What is the Importance of Estate Planning?
Estate planning is planning the distribution and management of your estate. This process must be done during your lifetime, or your survivors’ will have to do it after you pass away.
Real estate planning is important to make it easier for your family and loved ones to deal with your estate after you leave them.
Why do I need an estate plan?
9 benefits of estate planning
The importance of estate planning is evident from the benefits.
Estate planning ensures smooth transition for your loved ones, into a life without you.
Importance of wills and estate planning
Wills and estate planning go hand in hand. It is a legal document that iterates your wishes regarding property distribution and care of minor children.
The importance of wills –
You can get your will made online as well.
Do you need more reasons to write a will?
Documents Used for Estate Planning in the UK - Wills and Trusts
The two primary legal documents that record your wishes and instructions for the distribution of your estate are wills and trusts.
What are Wills?
Wills are documents that hold information about the individual’s assets, debt and beneficiaries. It contains the wishes of the deceased, and their instructions to distribute their estate after they are no more.
What are Trusts?
Trusts are legal arrangements that protect assets and distribute or direct them according to the individual’s wishes, instructions and intentions.
Trusts can come into effect before or after the individual’s death.
There are primarily two types of trusts –
Revocable trusts – Revocable trusts can be modified at any time.
Irrevocable trusts – Irrevocable trusts can not be modified after they have been created without the beneficiaries’ consent.
Trusts and wills, together, may be the better for estate planning, than individually.
Information needed for estate planning documents
Estate planning documents are made with the information you provide about your estate, beneficiaries and debts.
What information does a solicitor need to make a will?
Making a will is not easy, but with good estate planning guidance, it is not tough either.
The major information on wills include –
Assets – Asset ownership documents which certify that you are the owner like deeds, titles, accounts, and stocks.
Debt– Documents of mortgages, loans, hospital bills, and credit.
Beneficiaries – Personal information about beneficiaries like full names, addresses, phone and social security numbers, children and dates of birth.
Word of caution
Speak to Beneficiaries – Before you proceed with the will, ensure that you speak to the beneficiaries and guardians you plan to name them in the will.
You can’t legally obligate anyone to handle your estate or children if they don’t want to.
Speak to your solicitors– You’ll need to name one or two people who will handle the estate or your children.
Our tax advisors will help you with the best practices and help you make a will in time. We can help you upgrade an existing will as well.
Top 10 Estate Planning Mistakes to Avoid
Now that you’re thinking of estate planning, how do you proceed? Which mistakes should you avoid?
Here is a list of top 10 common estate planning mistakes you need to be careful of –
1. Not having a current estate plan
Always update your estate plan after a major life event, or if it’s been more than five years.
2. Not discussing the plan with family and friends
Keep your beneficiaries and friends in the loop, so that there is no disagreement after your passing.
3. Not naming more than one beneficiary
Always name more than one beneficiary in case the beneficiary is no longer able to fulfil their duties when you pass away.
4. Not appointing power of attorney
Always appoint a power of attorney or a healthcare proxy to take care of things when you’re inacapacitated. You need someone to make medical and financial decisions for you.
5. Not making proper final arrangements
Add how you want your final funeral proceedings in your estate planning document to lessen the stress on your loved ones.
6. Not putting digital assets in the will
Digital assets are important assets too. Add them in the estate planning document and name a Digital Executor who will take care of them after you.
7. Not accounting for charities
If charities are important to you, don’t forget to mention it in your estate planning document. One option is that you can name a charity as a beneficiary.
8. Not thinking about your children’s futures
In case of minor children, it is important to pen down in detail how you want the assets distributed – when they come of age, how the guardians use the money, and how much.
9. Not accounting for taxes
Unless you have a huge estate, your estate will not be taxed by the state. Understand the limits before you start drafting your estate planning document.
10. Not updating your plan frequently
Life changes everyday, and so must your estate plan. Your plan must always be updated to reflect your newest assets and properties.
These are the most common estate planning mistakes to avoid. However, if you’re going through this process for the first time, it’s better to seek professional help like an estate planner.
How Much Does Estate Planning Cost in the UK
The fee of estate planners is extremely versatile because of the constant changes in legal matters. The more complex the matter, the more the fee.
The estate planning cost depends on the services you opt for. Simple wills and estate planners may cost you anywhere between 200 to 500 GBP.
Trust documents may have higher price tags starting around 1000 GBP.
We give you a free 60 minute consultation to understand your needs and advise you about the best course of action for you.
How much should basic estate planning cost?
Basic estate planning can consist of just drafting the will and making the trust. One step further can also include legal advice.
Estate planning can be inexpensive or expensive depending on the estate planning package* you choose. Here is a small breakup –
|Consultation (60 minute)||Free|
|Single Will||£195.00 plus VAT|
|Premier Will||£395.00 plus VAT|
|Codicil||£35.00 plus VAT|
|Living Will||£150.00 plus VAT|
|Lasting Power of Attorney (single)||£450.00 plus VAT|
|Lasting Power of Attorney (pair)||£800.00 plus VAT|
|Estate Planning Package||£595.00 plus VAT|
*Please note that the prices quoted here are subject to change without prior notice.
How to Become an Estate Planner in the UK
Estate planners have thorough knowledge of everything related to estate planning such as investment, taxes, law, savings, property laws and personal assets.
They assist individuals in planning a long term strategy to focus on protection and transfer of assets and wealth. They also help to plan beyond the individual’s death.
You can become an estate planner if you have the right enterprise and drive for it.
What do estate planners do?
Professional estate planners help individuals protect their assets and prepare them to transfer and allocate their properties to beneficiaries.
This requires expertise in both personal finances and law.
Estate planners need financial expertise in matters of
They need expertise in Law in matters of
How much does an estate planner make?
The average estate planner salary is 65,000 GBP in the UK. A professional estate planner can make an average of 32 GBP an hour.
Please don’t hesitate to reach out to us for more queries.
What is Will Estate Planning?
Will estate planning is using a will as an instrument for estate planning.
Wills and estate planning are two different concepts. Will is a part of estate planning, which encompasses many more elements.
The will is an estate planning legal instrument and contains
Assets – The will contains a list of all the worldly possessions of the individual like physical property, and digital property.
Debt – The debt information like mortgages, credit and loans.
Beneficiaries – The inheritors of the property are mentioned in the will. They are the ones who will take care of the property after the individual’s death.
Instructions for final rites – The will can contain instructions for the individual’s last rites. They can put in how they want their funeral, and how they want to be remembered.
Guardians – In case of minor children, you’ll need to leave them with guardians, along with instructions of inheriting the property, the usage of the property till the children come of age.
A will simplifies things a lot, and avoids feuds among the family and friends.
Tips to hire an estate planner for will planning
- Look for a specialist
- Ask about the estate planner’s experience
- Ask what and how the estate planner charges
- Recognize that this is a long time transaction
- Talk about support and succession planning
Will vs Trust - Which is Better for Estate Planning?
Most people think estate planning is just writing a will, but there’s more to it.
While wills and trusts are legal instruments, they have some key differences that can be used for different purposes during estate planning.
Let’s get into the key differences first –
|Effective||After death||Once signed and funded|
|Guardianship for minor children||yes||on|
|Dispute||Can be contested, especially if not current.||current. Less likely to be contested since it is ongoing and current|
|Preference by law||Secondary to trusts||Trusts are preferred over wills|
|Tax benefits||no||Only for certain types of trusts|
|Protection from creditors||no||Only for certain types of trusts|
Should you choose will or trust for estate planning?
Awareness of the key differences can help you make an informed choice about which legal instrument would suit your needs.
Why Choose a Will –
Why Possibly Choose a Trust –
Let us help you to decide whether you should get a will or a trust. We will take a look at all the information you provide us and suggest the best instrument.
Wills and Trusts in Estate Planning
Estate planning needs a lot of deliberation before you reach a consensus.
Did you know that in a court of law, a trust is given more preference over a will? So if you have a will and a trust, and you happen to pass away, the court will give the trust preference in case of any disagreement.
Advantages of a trust over will in estate planning
You already know the requirements that you need to fulfil to make a trust or will.
If you are eligible to make a trust, you must know that there are certain advantages trusts have over wills.
Trusts offer more privacy than wills do. Will have to pass through probate. This means they have to be presented to probate courts to become effective. It becomes a public record. Trusts on the other hand, do not become public records and are administered privately.
Trusts provide greater control over assets and incomes. Wills are documents which gift assets to the beneficiaries. Trusts on the other hand give the grantor the flexibility and the power to tell their beneficiaries how to use the assets
The probate process is an extremely lengthy process and takes eight to twelve months to complete. Probate is verification of the assets and property of the person at the time of death. Trust has an advantage over wills in this regard. Trust transfers ownership of the assets to the trust. There is no probate process.
Another benefit of using a trust over a will is that you can access the assets during the lifetime. In case they become incapacitated, they may be able to use the trust for their own care. Having a trust makes it easier to manage assets while the person is alive as opposed to a will that does not make provision for disability.
It may be faster to dispose of assets which are already in a trust as compared to a will. In case of a will, the probate process is longer because the administrator has to contact the beneficiaries and assess the assets of the individual. Some trusts are easy to liquidate and distribute more easily and quickly.
Anyone considering drafting a will or opening a trust must consult an estate planner. The individual can even be advised to use both documents in accordance with each other. For example – the will can state that upon death all the individual’s assets will be transferred to a trust.
Estate planning needs careful deliberation and planning. This is best done with the help of estate planners.
Transferring property to a certain trust may protect your assets from your creditors.
As expert estate planners we can help you plan your estate for the maximum benefit.
Although absolute certainty can’t be guaranteed, you may still take steps to strengthen the certainty.
- Get your will written by professional will estate planners like us. We will help you put together your information and compile it in a carefully worded will, with very little room for misinterpretation. Hiring an estate planner also helps you to keep your will current.
- Get legal counsel for your assets.
- Discuss your will with your beneficiaries and heirs to avoid disputes after your death.
- Appoint a power of attorney to secure your will and/or trust is regarded.
We are professional estate planners specialising in inheritance tax and estate planning.
Estate planning also requires the professional to have knowledge of law. Drafting wills, trusts and other instruments of inheritance need to be made in compliance with the law.
A certified estate planner has been trained in the relevant law aspects.
No. Apart from the time consumed to put together the information – which is necessary – there are no disadvantages of estate planning.