Guide to Estate Planning: How to Ensure Your Legal Affairs Are in Order

21/12/2023

The end of a year is always a good time to take stock and make resolutions for the year ahead.

However, while some intentions fall by the wayside early on, other actions can have a lasting impact.

Ensuring you have the correct legal documents in place is one of those things.

Estate planning is crucial for all adults. Taking all the necessary steps needed to protect yourself, your wealth, and your family in the event of your ill health or death provides invaluable peace of mind and protection now and for years to come.

In this blog, our Private Client solicitors consider the importance of estate planning and give their top tips to ensure your affairs are in order as we move into 2024.

1. Make a list of your assets.

The first step in organising your estate planning is to undertake a thorough audit of all your various assets and their worth. This includes:

• Property.
• Pensions.
• Savings.
• Insurance policies.
• Personal items.

You should also compile a list of all your liabilities and debts, such as:

• Mortgages.
• Credit card bills.
• Repayments.
• Leases on cars.

This should be in written form and supported by relevant documentation if possible. Organising your affairs helps you develop a clear picture of your estate and how much it is worth and ensures any paperwork is on hand when you need it.

Running such a financial ‘health check’ can also be a useful starting point for a conversation with loved ones about your future plans.

2. Speak to a solicitor.

Once you have built up an idea of your estate, it is worth getting in touch with a solicitor.

An experienced legal professional will talk to you about your estate and your wishes, and propose the most suitable legal solutions to meet your needs.

As each person’s circumstances are different, protecting your assets isn’t always straightforward, and there can be various aspects you need to consider. For example, if you are living with your partner, you might need a cohabitation agreement, or if you are in a relationship and considering getting married, it might be worth making a prenuptial agreement.

At Russell & Russell, our estate planning solicitors will take the time to understand your situation and tailor their advice to fit your needs.

If you want to discuss how to protect your assets, speak to Russell & Russell. It’s free, and there is no obligation, so you’ll have a better idea of what your options are.

Call us on 0800 103 2600 to make an appointment or find out more.

3. Make a Will.

While there are a wide range of estate planning tools at our disposal and many different solutions to match each person’s particular requirements, a Will is one of the legal documents we all need, regardless of our circumstances.

Having a valid Will ensures that you leave your money and possessions to the people you want to benefit from them.

On a recent episode of his TV show, The Martin Lewis Money Show (ITV, 21 November 2023), financial expert and consumer champion Martin Lewis explained some key reasons for writing a Will. These included if:

• You have dependent children. If you have children under 18, you should consider who will look after them if you die by nominating a legal guardian in your Will. If you die without a Will, and there’s no other person with parental responsibility, the courts will decide who takes care of your children.
  
  
• You aren’t married to your partner. If you are not married or in a civil partnership, your partner might not be entitled to anything if you die without a Will.  At worst, this might mean they cannot stay in the home you shared.
  
  
• You’re worried about inheritance tax. If your estate is worth more than £325,000, you could face an inheritance tax (IHT) bill when you die. A Will can help you avoid IHT, for example, by leaving everything above the £325,000 threshold to your spouse (there is no IHT on money and assets left to a spouse).
  
  
• You have specific funeral wishes. If you know what you want your funeral to be like, you can include instructions in your Will for your family.
  
  
• You own property with someone else or overseas. If you own your home as ‘joint tenants’, ownership automatically passes to the other owner when you die. However, if you own your property on a ‘tenants in common’ basis, the intestacy rules will apply unless you have a Will. If you own property overseas, inheritance laws may differ from the UK’s.

If you have already made a Will, it is worth reviewing it to check that it continues to reflect your wishes. Certain changes in circumstances also make a Will invalid, so if you have got married or divorced, you will need to update your Will.

Writing a Will is not straightforward unless you are assisted by a solicitor. Although it can be tempting to do it yourself through an online template or attempt to save money by choosing an unregulated Will writer, this can be risky and can often result in mistakes that can prove costly.

An experienced solicitor will be able to ensure that a Will is drafted correctly and accurately reflects your wishes.

4. Create a Lasting Power of Attorney (LPA).  

Money-saving expert Martin Lewis also took the opportunity to highlight the benefits of LPAs on his weekly TV show, describing them as “crucial protection – not just for the elderly”.

An LPA is a document that allows someone (an ‘attorney’) to make decisions for you if you are no longer able to. It gives you more control over your future if you have an accident or suffer from an illness that results in you losing mental capacity.

There are two types of LPA:

• Property and financial affairs. This gives an attorney the power to make decisions about your property and finances, including paying bills, selling your home, collecting a pension, or managing a bank or building society account.
• Health and welfare. This LPA enables an attorney to make decisions involving your health and welfare, such as about your medical care, moving into a care home and your daily routine.

Martin Lewis explained: “Really important, this. I think Power of Attorney is more important than a Will. A Will decides what happens to your assets if you die. Power of Attorney, what happens to your assets if you lose your faculties: you’re still alive and you may have your own care and family that you need to look after, but you’re no longer capable of doing it yourself.

"Power of Attorney is where you nominate a friend or relative to take over your finances if you lose your faculties. Doing it does not mean you give up control now. It does not mean that.

"Power of Attorney is not just for the elderly. Everybody in this room should be considering one. I've had one for a decade now. I have no foreseeability of losing my faculties,” revealed Martin.

Solicitors for Estate Planning

At Russell & Russell, we have extensive experience helping a wide range of individuals and families with their legal needs.

Our specialist solicitors work together and with you to ensure you benefit from a joined-up, all-around approach to estate planning. Our experienced team will make sure all bases are covered and you, your assets, and your interests are protected.

Russell & Russell Solicitors’ Wills and Probate department has extensive experience in Will writing, probate and asset management.

We’re accredited by the Law Society’s Wills and Inheritance Quality Scheme (WIQS), which sets the benchmark for best practice and transparency in the provision of wills and estate planning services.

Our Lasting Powers of Attorney solicitors are specialists in their field and will ensure your LPAs are tailored according to your wishes and cover every eventuality.

Our Estate Planning team works alongside Russell & Russell’s Family department, which offers advice and representation on all aspects of family law, including cohabitation and prenuptial agreements.

To speak to a solicitor or to arrange a free, initial consultation with one of the team, call Russell & Russell on 0800 103 2600 or request a call back.

Please note that this article is meant as general guidance and not intended as legal or professional advice. Updates to the law may have changed since this article was published.