The Importance of Updating Your Will Regularly
The nation's Will statistics are not reassuring. According to recent research by Canada Life, half of all adults and around one-third of those over 55 in the UK do not have a Will.
This means that tens of millions of people will have no say over where their estate will go when they die. The truth is that this is only half of the problem. Research also shows that around half of the Wills that have been drawn up are out of date. In this article, we will discuss why it is so important to update your Will every five years or after a key life event.
When does a Will become out of date?
Wills do not have an ‘expiry date’ per se, but they become out of date if they no longer reflect the needs and wishes of the person who made the Will (the testator). Wills should ideally be updated at least every five years to reflect changes in circumstances. Much can happen in a five-year period, including:
- Changes in relationships (e.g. cohabitation, marriage or divorce)
- Purchase of new property / moving home
- Birth of children
- Deaths
- Creation of new businesses
- Receipt of inheritances, and
- New assets and investments
Any of these may warrant a change to a Will to ensure that it is accurate. Wills should also be updated if a testator changes their mind regarding how their estate should be handled when they die. For example, they may decide to give a larger share of their estate, the family business, or a particular asset (e.g. a car) to a family member.
A Will may also be out of date if an executor named in the document has died or the testator no longer wants them in this role. In this case, the testator may want to add a new executor or remove one if two or more were named originally.
If a testator has left some of their estate to their children in the form of a trust fund, a testator may also want to increase the age at which they will receive their inheritance. This would require a change to their Will to ensure this is carried out correctly.
Even if there have been no major life changes or new inheritance decisions, it still makes strong sense to sit down with a Solicitor every few years to review your Will to ensure it is still valid and correct. From our own experience, we have observed on many occasions testators who believed they understood the contents of a Will written many years previous, when, in fact, their recollection was completely inaccurate.
The danger here is that they had been telling family and friends that they would receive an inheritance when this was not the case. This can lead to significant family disputes after death; something that no person would ever want to leave as a legacy.
What happens if a Will is out of date?
There are several potential implications of an out-of-date Will. The obvious impact is that if your Will does not reflect your wishes when you die, your estate will not be distributed how you want. This may mean that a family member or friend whom you wanted to inherit part of your estate does not receive any inheritance at all. Not only may this result in a loved one not receiving an inheritance, but it may lead to familial dispute, resentment, and ill-feeling.
Out of date, Wills may also be contested by those who were told they would receive an inheritance if this is not reflected in the Will. Even if there is no valid ground for contesting the Will, attempts to do so can significantly slow down the process of executing the Will and the distribution of the estate.
Another risk is that more money may be paid to HMRC in the form of inheritance tax (IHT) than you envisaged because of how the Will was written and how your estate has been divided. For example, if you received a large inheritance that makes the value of your estate exceed the IHT threshold, IHT may be charged at 40%. The net result is that a larger chunk of your estate may be lost to IHT and not distributed to your loved ones. A Solicitor who specialises in Wills can advise on how your Will can be amended so that more of your estate goes to your family and friends and not the ‘tax man’.
Final words
Changing your Will is not a difficult, lengthy, or costly process. In many cases, a minor change may be made in the form of a codicil which is attached to the original Will. This means that the original Will does not need to be completely rewritten. Codicils are typically used when changing executors, adding or removing beneficiaries, and adding new gifts. If a large change or several changes are needed, this may warrant a re-drafting of a Will.
Ultimately, think of having your Will reviewed periodically and changed if necessary, rather like having your car maintained periodically. It will ensure that your Will is exactly as it should be and that your family members receive part of your estate according to your wishes when you die.
For a free initial consultation (England/Wales), to discuss your Will please call our private client law team on 0208 300 6666.
