Michael Jackson's premature death at the age of 50 is a timely reminder for us all to take great care when it comes to our finances.
When Michael Jackson died, his financial affairs were in disarray. His family appeared to be confused about whether he had made a will and if so, what his wishes were regarding the custody of his children and his estate.
Since his death, a will has now surfaced which Jackson wrote in 2002. In it Jackson gives custody of his three children to his 79-year-old mother Katherine, but none of Jackson's family were prepared and certain of his wishes before he died. According to the family's lawyer, "[The family] didn't see it prior to the filing. We wish we had known about it earlier."
Now there are rumours that Jackson's ex-wife may now decide to contest the will or even his father Joe, who was omitted out of the will, potentially leaving the Jackson's estate in limbo for many years to come.
But what does Michael Jackson's sorry demise have to do with us? It proves that it's important for all of us to make a will and inform our family of our wishes before our death.
Writing a will may seem bleak and you may think you're too young to do it or it's too depressing to think about, but it's quick and cheap to do and once it's done your family are protected.
It's never too early to write your will. So if you're thinking about it, here are the main reasons why you should not put it off any longer.
1. You can control who will inherit your money and property.
If you die without making a will, your property will be distributed according to law (the law of 'intestacy'), which is likely to be against your personal wishes and the people you want to inherit your possessions may not benefit. By making a will, you can determine precisely who will inherit your property and let your loved ones know that you have considered their needs.
The law of intestacy is complex, but, broadly speaking, the bulk of your estate will go to your spouse or, if none, to your children and, if none, to other specified blood relatives. The effect of the rules depends partly on the size of your estate.
If you have surviving children, then your spouse will receive a maximum amount of £250,000 outright from your estate. The balance is then shared between your spouse, who takes half of the remainder as a life interest (and thereafter it goes to your children) and your children take the other half outright, providing that they're not minors.
If you leave no surviving children, then your spouse takes a maximum of £450,000 outright with a life interest in half of the remainder, the rest of which goes to other close relatives as defined. The amount your spouse gets therefore may be less than you expect.
So if you're married, it's important that both of you make wills, even if the marital assets are primarily in the name of one spouse. By making a will, you can name your spouse as your main beneficiary and include an alternative inheritance if your spouse dies before you.
Note that the rules for spouses are the same as the rules for those gay couples who register as civil partners under the Civil Partnerships Act 2004.
Find out more about our outdated laws on intestacy here.
If you're not married and have not made a will, your partner may receive nothing.
If you're not married but are living with your partner and you want them to inherit your estate, it's particularly important that you make a will. This is because the rules of intestacy make no provision for cohabitation or unmarried partners (other than registered civil partners). If you died without making a will, your partner may not be legally entitled to anything from your estate.
3. You can determine who will handle your affairs after your death.
If you die without making a will, you die 'intestate'. This means that the management of your affairs is then placed in the hands of administrators who are appointed by the court. The administrators distribute your estate according to the rules of intestacy (see above).
4. You can name a guardian for your children.
If you have minor children, you can name a guardian to care for them in the event of them being left without any parents. Since a guardian takes the place of a parent, making a will gives you the option of choosing someone you believe will offer the best care for your children if you're not around.
6. You can save inheritance tax.
Making a will gives you the opportunity of saving inheritance tax liability. This is particularly important if you have substantial assets.
Read our seven steps to saving inheritance tax here.
7. You can express your preferences for what happens after your death.
By making a will, you can express your preferences for burial or cremation and for donating organs or your entire body for medical purposes.
8. You can leave money to charity.
Not only can you leave money from your estate to your relatives, but you can also specify a bequest to charity or even a cats' home!
Revising your will
You must check your will regularly as it's also possible to die partially intestate. This occurs if you fail to deal with all of your property in your will or if a particular someone who was due to inherit in your will dies before you.
You must also mak a new will if your circumstances change. Marriage, separation, divorce, having a child or moving house can make parts of the will invalid or unfair and open to a successful claim under the Inheritance Act. You should, therefore, review your will regularly to reflect any major life changes, preferably every five years.
Find out why you should make a will if you're getting divorced.
Is it time you updated your will? Download a DIY will kit today.
How to make a Will
Want to make a Will?There are three ways you can make a will and it doesn't have to be difficult or expensive:
- You can use a DIY Will Kit, either in paper form or available to download, for as little as £9.99. It takes you step by step through the process.
- You can use an Internet Will service where you fill in your details and a team of experts writes the Will for you.
- You can use a solicitor. Take Legal Advice can help you to find a lawyer that suits your needs.
Futher information
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