In some ways, wills are odd things. These obviously important documents, dictating how all your worldly possessions are to be distributed, are kept sealed and are only read out after the funeral. You and your children may both know your will has been made – potentially concerning life-changing sums of money for the latter –but it is unlikely to have been discussed.
Talking about money and mortality can sometimes be unpleasant. But there is a strong case for involving children in legacy planning and even for bringing them to meetings with financial advisers.
Unfortunately, this is because legacy planning is often simply boiled down to leaving everything as a lump sum at death. Why? Because, more often than not, a will reflects the decisions and wishes of one person (or couple) with assets divided up in a very typical way.
While it is the inheritor’s assets to do with as they please, it can be worthwhile taking into consideration the feelings and wishes of beneficiaries. For instance, while loved ones may benefit from a windfall, this can create confusion and sudden wealth syndrome (the distress lottery winners often experience). And likewise, if you have decided not to leave wealth to loved ones, it is important to fully explain this reasoning to them.
Get the family involved
Involving your children in your financial plans can help them become better prepared for their inheritance and let them have a say on how your estate is structured. Having them sit in on financial planning meetings means they can ask questions, air any grievances and generally become more involved in their own legacy.
Some things to consider might be:
- Would your children benefit from receiving their inheritance sooner?
- Are there philanthropic causes they would instead want to see championed?
- Who would be best suited to take ownership of prized antiques that have strong sentimental value?
- Who can afford to maintain a large property?
- Where are they domiciled?
These are just some of the considerations that, if properly discussed with beneficiaries, can allow for an estate to be more effectively structured. Not only will this mean your children feel more involved, but they may be able to extend these lessons to their own finances and become savvier as a result.
Clear communication about an estate can also help avoid disagreements down the line. A recent survey by Direct Line Life Insurance found over 12 million Brits would be willing to contest a will if they disagreed with it, with over £160,000 being spent trying to block probate filings in 2017 (for context, it costs £20 to try and block a probate application). Aside from the heavy legal bills involved in lengthy will disputes, these disagreements can run deep and unfortunately cause family rifts. Such disputes are especially difficult to resolve as the inheritor isn’t around anymore to clarify their decisions or answer questions. Truly, a costly oversight!
At London & Capital, we encourage our clients to engage with their loved ones about these topics and as a firm we welcome family members’ presence at meetings. We understand the role that money can play in a family and how it can influence a legacy for generations to come, so our advisers always consider intergenerational wealth planning. If you are thinking more about your estate and want your family to be as prepared as possible, contact the London & Capital team today to enquire about a family meeting with one of our advisers.
If you would like to discuss your financial planning, please get in touch using the CONTACT FORM HERE.