Knowing exactly how to manage your estate can be confusing and time-consuming, but it is essential. Estate planning gives you more control over your assets and allows for the transfer of your wealth to others at the lowest possible cost.
Consult a professional
According to This is Money, “Seven out of ten people die intestate – without a will. This enables the Treasury to trouser more than £50 million a year that might otherwise have gone to help our loved ones.” Setting up a basic will costs only around £250 and takes only a couple of hours to complete.
When thinking about managing your estate, it is essential that you consult a professional. When speaking to a professional, they will address a number of key areas. These include the transfer of your wealth, minimising tax, asset protection and charitable giving. They will ensure your wishes are followed and that you are managing your estate correctly and efficiently.
Wills, Trusts and Power of Attorney
When you consult a professional, they will help you manage your Will, Trusts and Power of Attorney. Your Will dictates the fate of all your assets, deciding who gets your property and how much. It is vitally important that this reflects your wishes and is up to date. A Trust entrusts the managing of your property to another person or organisation, allowing them to manage the property on behalf of your beneficiaries. Finally, a Power of Attorney gives a person or organisation the legal power to handle your assets if you are unable.
What exactly do these three things entail?
- Wealth transfer
Making a Will ensures your family are cared for after your death by distributing your wealth to your loved ones. If prepared correctly by a professional, your Will can also ensure you are paying the least tax you can on your assets. In your Will, you decide who will manage your estate in case of disability or incapacity, and you can also deal with specific financial security for others, such as for children of previous marriages.
- Asset protection plan
For those with substantial assets, creditor protection can be a concern. An asset protection plan will allow you to identify potential exposures and come up with a strategy. It allows you to deal with ownership issues, liability insurance, offshore/domestic trusts and divorce, for example.
You may also wish to consider charitable giving for personal reasons or tax reasons.
- Choosing guardians for your children
Deciding who will look after your children in case of your death is something none of us want to think about, but it is something you must address to ensure they get the care they need. You can also ensure any money will be kept in a trust for them until they are of age. Setting up a trust lowers potential inheritance tax.
You need to ensure you consult a professional with your interests at heart. Professionals at companies such as Partridge Muir & Warren are your best bet, as they will take the time to make a financial plan tailored to you, and will provide personal, independent advice.
There you have it – everything you need to know about managing your estate for the future.