The importance of and how to make a will
Discussing what we would like to happen after we die is a conversation that most of us would rather defer. Yet making a will is essential if you want to ensure that your wishes are met following your death.
If you die without making a will or leaving a valid will, the law will determine who inherits what you own. In legal terms this is known as dying ‘intestate’. If you die intestate your money, property and personal possessions will be distributed in accordance with the rules on intestacy.
This is especially significant if you have loved ones that depend on you financially, particularly if you are unmarried. Knowing how to make a will can protect your family and loved ones from future financial uncertainty. It can also be an effective way of mitigating any inheritance tax liability and, in turn, maximising the net value of your estate for those that you leave behind..
Below we examine the main steps on how to make a will, from valuing your estate to signing the completed document. We also look at when it is important to seek professional legal advice on how to make a will.
Step-by-step guide on how to make a will
Establishing the value of your estate
The first step in how to make a will is to get an idea of how much your estate is worth. Your estate includes everything you own. Assets that typically make up an estate are:
- your home or any other property you own
- your share of any jointly owned asset
- your furniture and household contents
- any motor vehicle(s)
- any other physical possessions including jewellery, antiques and artwork
- any other personal belongings, including clothing
- any bank, building society or other savings
- any occupational pensions that include a lump sum payment on death
- any life assurance or endowment policies
- any stocks and shares or other investments.
Prior to having your will written it would be sensible to draw up a list of your assets, as well as any debts that you may have including mortgages, loans or credit card balances. Your assets will only be distributed once any debts, taxes, funeral expenses and administration costs have been paid.
Valuing your estate can be helpful in deciding how you want to distribute your net worth. As such, you should ensure that you regularly value your property and seek legal advice for any future estate planning and inheritance tax issues.
Deciding who should benefit from your estate
The second step in how to make a will is deciding who will benefit from your estate. These are known as the beneficiaries.
You can divide your estate between different people, specifying what proportion or specific assets each individual should inherit. This can also include a legacy or donation to a charity. You will then need to decide who will benefit from any residue of your estate.
You should also make provision within your will for any contingencies, in particular what you would want to happen if any beneficiary should die before you. You may want their share to be inherited by another named individual or, alternatively, for that share to be divided up between the remaining beneficiaries. You may also want any inheritance to be held on trust, for example, for any children under the age of 18.
A trust is a legal mechanism by which assets are cared for and controlled by trustees for the benefit of a beneficiary. If you would like to incorporate a trust arrangement into your will you should always seek expert legal advice to ensure that after you die your estate is handled in accordance with your wishes.
Deciding who should deal with your estate
The third step in how to make a will is deciding who you would like to deal with your financial affairs after you die. These are known as the executors. They will be responsible for applying for the grant of probate, the official document needed to deal with your estate.
Having paid off any debts, taxes, funeral expenses and administration costs, they will be responsible for distributing your money and property in accordance with your will.
An executor can be a family member or friend. An executor can also be a beneficiary under the will. An executor will not normally be paid unless you appoint a professional to act as an executor, for example, a solicitor or accountant. This may be prudent if your estate is large or complicated or, alternatively, to avoid any family disputes. A professional executor will charge for their services and their fees will be paid out of your estate.
Only four executors can act at any one time, with a minimum of one. If there is more than one executor they can share the responsibility, and if one dies the remaining executors will still be able to deal with the estate. If you only appoint one executor you should make provision for a replacement in the event that they predecease you, or are otherwise unable or refuse to act.
Signing & witnessing your will
The final step in how to make a will is to ensure that is it signed and witnessed. It must be signed by you in the presence of two independent witnesses and, thereafter, signed by both of them in your presence. Further, for your will to be legally valid, both you and your witnesses must be aged 18 years or over.
A witness, or the married partner of a witness, is unable to benefit under your will. As such, neither a beneficiary, nor their spouse or civil partner, should act as a witness. Whilst your will would remain valid, the witness would lose their entitlement to inherit.
When signing your will you must do so voluntarily and be of sound mind. This means that you must have the mental capacity to understand the nature of the document that you are signing. If you have an illness which impacts on your mental capacity, you may need a statement from a medical practitioner at the time the will is signed certifying that you understand what you are signing.
If you are physically unable to sign your will it can be signed on your behalf, albeit this must be done in your presence and contain a clause stating that you understood the contents of the will prior to it being signed. Seeking legal advice and representation could prove to be crucial here.
Once signed and witnessed your will is complete and it should be stored somewhere safe. Your legal adviser can provide safe storage for you. You should also let your executors know the whereabouts of your will and provide them with a copy.
How to make a will yourself
A will is a legal document that needs to be written, signed and witnessed correctly. Whilst it is possible to draft your own will you should still seek legal advice, or at the very least have your will checked over by a legal specialist to ensure that it is valid, that it accurately reflects your wishes and provides for any contingencies.
A badly drafted will may be difficult to interpret and open to challenge after you die, causing additional stress and emotional upset for loved ones at an already difficult time. If your will is legally contested or declared invalid, your estate is unlikely to be distributed in accordance with your wishes.
Ensuring that your will is both legally compliant and clearly drafted can avoid any unnecessary disputes after you have died – disputes which may result in considerable legal costs being off set against the value of your estate.
The importance of seeking legal advice on how to make a will
Whilst this step-by-step guide provides a basic outline of how to make a will, complications and mistakes can be common when drafting your own. Seeking legal advice can often be essential in ensuring that your money, property and possessions are distributed in accordance with your wishes when the time comes.
In particular, guidance should be sought from a legal advisor specialising in wills and probate for the following matters, although this list is by no means exhaustive:
- to make financial provision for your partner where you are unmarried or not in a civil partnership
- to make financial provision for your spouse, civil partner or cohabiting partner where you jointly own property
- to make financial provision for any children from a previous relationship where you are married or in a civil partnership
- to make arrangements within your will for looking after children under 18
- to set up a trust within your will to manage any inheritance of a beneficiary aged 18 or under
- to create a codicil, ie; an official document to amend an existing will
- any form of estate planning and inheritance tax issues.
If you already have a will, this should be regularly reviewed and updated. At the very least you should consider replacing your will following any major life change such as marriage, divorce, dissolution of a civil partnership, the birth of a new child or grandchild, or if a beneficiary or executor dies.
If you are under any doubt as to making or amending an existing will you should always seek expert legal advice.