Latimer Hinks Solicitors, one of the North East’s leading law firms, is calling for residents in the region to make a new year’s resolution to get their financial and legal affairs in order.
Although estate planning is not a traditional task to undertake during the festive season, the firm is encouraging people to start the year with good habits and the peace of mind that comes from having a will in place and financial issues resolved.
Elizabeth Armstrong, a director at Latimer Hinks, said: “The start of a new year is an ideal time to get your affairs in order, as your mind is fresh, allowing you to examine clearly what you need. There are some essentials, such as a will, that you should put in place as a priority, if you don’t already have one.
“The lack of a will means that, should you pass away, intestacy rules apply and loved ones could miss out on property or funds that you would like them to inherit. Having no will or having an out of date will could result in lengthy and costly disputes, bad feeling and even legal battles for your family while they are grieving.
“Whilst it’s never comfortable to discuss death, it is important to try and ensure that, after you’ve gone, your legacy promotes happy memories rather than confusion and bitterness.”
The team at Latimer Hinks has suggested the below checklist to get your affairs in order in 2020 with clarity:
Make or review your will
Elizabeth says: “Recent research has found that more than 31 million adults in the UK risk dying without a will in place, with three quarters of 35 to 54-year olds failing to make arrangements for their assets after they die. Remember that you may want to change your will after the birth of children or grandchildren or following the breakdown of a relationship.”
Check your will after marriage
Elizabeth says: “Unless your will makes a specific reference to an impending marriage, your will is invalidated after your wedding. Couples often don’t realise this, and this can cause issues following the death of a spouse, particularly if that person has children from a previous relationship or other people they wish to include as beneficiaries of their estate.”
Create a lasting power of attorney
Elizabeth says: “A lasting power of attorney allows you to appoint someone to make decisions about your health care or your financial assets should capacity ever become an issue. If you feel you may need this, it is important to act while you are still healthy, as the process becomes more difficult for people who do not have capacity to make decisions. This can be a difficult conversation to have with a loved one, but it is best to be prepared.”
Make lifetime gifts from excess income
Elizabeth says: “If you have surplus income, you may be able to take advantage of a valuable Inheritance Tax (IHT) exemption by making regular cash gifts to family and friends who you wish to inherit from your estate. These gifts are not taken into account after you die, so giving them to relatives while you’re still alive can prove beneficial. A STEP qualified solicitor will be able to offer advice to ensure you secure the best tax treatment.”
Take advantage of reliefs, exemptions and allowances
Elizabeth says: “Ensure that you are aware of any available reliefs, exemptions and allowances for IHT, and that you take advantage of them where you can. If your estate would be worth more than the basic IHT threshold after your death, it may benefit from and additional residence nil rate band before any IHT is due. However, the rules are not always straightforward and if you think this may apply to you, it is worth speaking with your solicitor.