How to talk about inheritance
The thought of our loved ones passing away isn’t something people like to dwell on. Indeed, many may move the conversation on at the very hint of the topic. However, it’s really important to make sure family and friends are aware of our wishes ahead of time so they don’t have to go through surprise matters of inheritance.
Although we think of inheritance as relating to older members of the family, discussions of estate should begin earlier. However, adult children may find it very uncomfortable to broach the subject with their parents and younger married couples may find it morbid to discuss it.
Clearly, financial matters are a delicate topic, no matter who it is. It can come across as greedy or insensitive if not done correctly, so it’s important to talk about inheritance with due care and consideration.
When it comes to planning for inheritance, be as open as you can about your financial situation and wishes. Try not to get too emotional, as this can make the process more painful than it needs to be. Be objective by writing down preliminary thoughts to discuss with your loved ones and make sure they understand.
Make a Will
Having legal documents to support what you discuss with your loved ones can make it easier. Although the laws of intestacy in the UK may align with the wants for your assets when you’re gone, creating a Will lends legitimacy and makes them less contestable. This could limit the potential for disagreements, making your passing more peaceful for your loved ones.
It’s important to note that you don’t need to have a large estate to make a Will – this is a common misconception.
Allow for probate
It’s important your loved ones have realistic expectations by making sure everyone is clear on the process. Grant of probate is needed in many cases and can take a substantial amount of time to come through. The wishes of the Will can’t be fully carried out until this is granted.
Unfortunately, inheritance tax must usually be paid before probate begins. Applying for a probate loan is one way to try to move the process along in a timely manner.
If you’re making plans to reduce the impact of tax on your estate or joint estate, consider gifting some assets in advance. After seven years, the gift is no longer taxable and therefore could be an excellent option for those who aren’t yet elderly.
There are limits on the amounts which can be legally gifted and for what, however, so be sure to check before transferring any sums.
Situations and plans change. People may move in or out of families and lives. While all this is normal, it means documents and wishes may need to be discussed periodically, so it all still reflects your wishes.
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