Taking care of your children’s inheritance
The natural tendency when writing a will is to keep things simple.
This means that most couples leave everything to their partner. The idea is that when the surviving partner dies, everything will be left to any children they have.
In most cases this works fine, but it is worth bearing in mind a few scenarios which could leave your children at risk of losing out, and it might be worth considering other steps to guarantee your money goes where you want it too.
Problems can arise:
- If one partner dies and the surviving one remarries
- The couple later get divorced or legally end their civil partnership and begin new legal partnerships
This could result in what is known as sideways disinheritance which means that in certain instances the law favours passing an estate sideways to a new partner rather than downwards to children.
It is worth considering that a divorce, or the legal ending of a civil partnership, does not annul a will, BUT any references to a former partner will no longer be valid. If your will leaves everything to your ex-partner, it will be treated as if you have died intestate.
Also, if you remarry, your will is automatically cancelled, potentially meaning you’ll die intestate if you don’t write another one.
In this situation, £250,000 worth of property and assets along with half of the remainder of the estate will pass to your new partner. The other half will be split between your children.
This may not be what you want!
There is also the danger that if a new will is drawn up after a remarriage, everything will be left to the new partner with no mention of any children from a previous marriage.
The surviving partner could even fall out with the children. They could remarry and then leave their estate to someone else entirely.
There is the option of using a Life Interest Trust which can preserve assets for the next generation whilst at the same time allowing the current generation to continue to benefit, say from living in the family home.
You could use a Life Interest Trust if:
- You have concerns that your spouse could remarry after your death and their new family would inherit your assets.
- If you have remarried, a Life Interest Trust allows you to provide for your new spouse but ultimately passes your assets to your own children.
It can be a little more complex to set up a trust, but it’s natural to want to ensure that your loved ones, especially your children, inherit after you die.
After all, you want your assets to be distributed in line with your wishes.
To discuss your will and the possibility of using Life Interest Trusts, contact us 01952 305105 or 07786 548025 or email firstname.lastname@example.org