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Estate planning: beyond wills and legacies

6 minute read

Estate planning is a crucial task that goes beyond just preparing a will…

It encompasses various aspects, from managing financial assets to passing on a personal and emotional legacy. Estate planning ensures that your hard-earned assets are distributed as per your wishes, while also allowing you to pass on your values, traditions, and family stories.

In this article, we will explore essential considerations when planning your estate, from understanding the legalities to choosing executors and trustees, as well as preserving your non-financial legacy.

Setting clear goals

Before embarking on the estate planning journey, it's vital to establish clear objectives for the distribution of your assets. Ask yourself questions like:

  • Who do you want to benefit from your estate, and in what proportions?
  • Are there specific charities or organizations you wish to support?
  • Do you want to provide for your spouse, children, or other dependents?
  • Are there specific heirlooms or family treasures you wish to pass on?
  • What non-financial legacies, such as values and traditions, do you want to preserve?

By answering these questions, you can define your estate planning goals more precisely and make informed decisions about your financial and non-financial assets.

Understanding the legal framework

Estate planning in the UK operates within a legal framework, which primarily involves:

Writing a Will 
A legally valid will is essential to direct the distribution of your assets. You can specify your beneficiaries, appoint guardians for minor children, and even make charitable bequests.

Inheritance Tax 
In the UK, estate planning should consider inheritance tax, especially right now when the future of inheritance tax is under review. There are various allowances, exemptions, and reliefs available, and a well-thought-out plan can help minimize the tax burden on your estate.

Lasting Power of Attorney (LPA)
An LPA allows you to appoint someone to manage your financial or health-related decisions if you become unable to do so. It's an important part of estate planning to ensure your affairs are handled as you would wish. Although it’s worth noting that an LPA only works whilst you’re alive.

Trusts are a versatile tool for managing and protecting assets, potentially minimizing inheritance tax, and ensuring the orderly distribution of assets.

Choosing executors and trustees

Selecting the right executors and trustees is a crucial part of estate planning. Executors are responsible for administering your estate after your passing, including the distribution of assets as per your will. Trustees, on the other hand, manage assets placed in trust for the benefit of specific individuals or entities.

When choosing executors and trustees:

  • Consider individuals or professional firms with financial expertise.
  • Ensure they are willing to take on the role and have no conflicts of interest.
  • Keep an open line of communication with your chosen executors and trustees to ensure they understand your intentions.

Remember that you can name different individuals for these roles, or even have them serve jointly. The key is to select individuals who are trustworthy, responsible, and capable of handling the responsibilities.

Legacy planning

Estate planning goes beyond financial assets; it can also involve passing on a personal and emotional legacy. Consider ways to preserve your values, traditions, and family stories:

Ethical Will
An ethical will, also known as a legacy letter or values statement, is a document in which you share your personal values, beliefs, and life lessons. It provides guidance to your heirs, helping them understand your core principles and what you hold dear.

Family Meetings
Gather your family to discuss your estate plan and the emotional legacies you wish to pass on. Encourage open dialogue and share the stories, traditions, and values that are important to you.

Record Family Stories
Document your family's history through oral or written accounts. Share stories about your ancestors, your own experiences, and the values that have guided your family through the generations.

Family Traditions
Identify the traditions that are significant to your family, whether they involve holiday celebrations, special recipes, or unique rituals. Ensure they are documented and passed down.

Charitable Giving
Consider incorporating charitable giving into your estate plan. This not only supports causes you care about but also instils the value of philanthropy in future generations.

Heirlooms and Treasures
Clearly specify who should inherit family heirlooms and treasured possessions in your will. Include stories or history associated with these items to make the inheritance more meaningful.

Preserving a personal and emotional legacy is just as important as managing financial assets. These elements of estate planning help ensure that your family's history and values continue to be cherished by generations to come. It’s not just about preparing for the end; it's about ensuring a bright future for your family and preserving the essence of who you are.

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