Estate planning is the service that manages your assets after you’re gone. But if you want to make sure your assets are well taken care of when the time comes, you need to make sure you’re doing things the right way while you can. Estate planning advice from professionals can make sure you’re set. Not planning properly can cause more issues, such as financial losses, legal complications or even the much-dreaded family disputes. Read this article if you want to avoid all of that. Here are some of the most common mistakes people make when planning their post-mortem wealth transfer.  

Mistake no. 1: Not Having a Will

Unless you want your assets to be distributed according to the UK law, then you must make sure you have a will. This ensures your wealth goes where you want it to go (and not to that aunt no one ever speaks to). If you want your close family or friends to inherit your assets, then it is a must that you protect that desire of yours with a will.

Setting a will ensures your money and properties go where they should and it also protects the vulnerable ones, such as children or the elderly, in obtaining their share. Remember all of those issues we mentioned earlier? A will is a form of estate planning that is going to help you avoid most of them.

Here are some tips:

• Don’t just scribble words down – write them in the presence of an attorney, with the help of a solicitor who can provide more information. Make sure it is legally sound.
• Remember to update it if your circumstances change. Marriages, divorces, the birth of children, it should all be reflected in it.
• Don’t forget where you put it. A will is useless if no one can find it. Keep it safe somewhere and make sure your executor is aware of its location at all times.

Mistake no. 2: Not Consulting With an UK Estate Planning Expert

According to UK law, inheritance tax applies to the money, property and possessions of someone who has just passed away. There are thereshold and exceptions to this law, which makes it all the more complicated for the commoner. For example, you are exempt from the tax if the estate is valued at below £325,000 but, you can also avoid the tax even if the value is higher by leaving it to a spouse, a civil partner, a charity or a community amateur sports club. At the same time, if you want to leave your estate to your children, your threshold jumps up to £500,000. See how calculating the inheritance tax can be complicated? That’s why you need the help of a UK estate planning expert.

Here’s how to avoid this mistake:

• Work with professionals who can provide estate planning advice to make sure you get the best deal and explore all of the possible strategies
• Consider including insurance policies that address IHT liabilities
• Take the threshold into account and see if that can benefit you in any way

Mistake no.3: Not Getting Estate Planning Advice, Such as Getting a Trust

Trust the estate planning advice your tax advisor gives you and consider a trust. Trusts work similarly to wills but in a more detailed and specific way. They include protection policies for vulnerable people and for those who are not trusted with the management of large sums of money. They are best known and used for their capability to make sure your assets remain within the family, even in case of divorce or bankruptcy.

Here’s how to avoid this common mistake:

• Consult with a professional estate planner
• Learn about the many types of trusts there are
• Make sure it is legally sound

Mistake no. 4: Overlooking Digital Assets

Our world is ever-changing and, with the emergence of digital assets, it is important that you look into ways to protect that as well. If you’re using these assets, then you must know that most of the time they require legal authority to access. In that case, your family and dear ones might have a hard time getting a hold of financial and sentimental assets.

Many people often overlook digital assets because the industry is rather new in this regard and no one really knows how things work for online possessions. Here are some tips on how to avoid this mistake:

• Put together a sound document outlining your digital assets
• Make sure you include either a separate document on how you want these assets to be managed or an addendum to your will/trust.
• There are digital legacy services available. Contact an expert for more information in this regard.

Mistake no. 5: Not Reviewing and Updating Your Plan

We brushed up on the importance of updating your will and trust earlier, but truth be told, this is such an important aspect and easily-forgettable, that we have to address it again. Most people write their will and consider it an “out of sight out of mind” type of thing. They know they’ve written it and then forget about it. It is only after the passing of the person in question that the family and loved ones see how forgetting to update a will can mess things up.

Sometimes you don’t need a major event to update your will. Reading it every few years might open your eyes and show you how your priories have changed. Often times there are also additions to a family that you might want to add to the will but, unless you remember to do it, they will be left out.

How to avoid this mistake:

• Renew your will every 3-5 years or when major events occur. Don’t postpone it or “leave it for later”. The sooner you change it, the better.
• Make sure the will is still in compliance with the law. If certain taxes have changed or if more benefits have been included, make sure you check your will so that it still works to your benefit. Professional estate planning advice can help you get the most of the law and avoid extra costs.