Last year, almost £1 billion was left ownerless as a result of people dying without having written a will. But what happens to this money when no recipients have been specified?
We discussed this in a previous blog about dying intestate:
“If a person dies without a will in place, banks are required to freeze their accounts until a beneficiary is decided. They are allowed to release funds at their own discretion, if the figure falls below the amount set in the bank’s guidelines. This amount can vary from £20,000 to £30,000 depending on the institution”.
According to laws in England and Wales, when you die without a will, your partner or spouse will receive the first £250,000 plus half of the remainder. The rest is split equally between children (or grandchildren if there are no surviving children). This, of course, may not be how you wish your estate to be divided.
Filling in The Details
There is more to a will than deciding who you want to receive your money, too. You can also detail your funeral preferences and appoint will executors whom you wish you carry out the instructions in your will. The executor will have to apply for a grant of probate in order to distribute the estate. It is worth noting that for estates over £5,000, a probate fee of £215 is applied. Executors can be individuals or a professional organisation such as a solicitors firm.
Power of Attorney
It is also wise to set up a Lasting Power of Attorney. If you become unable to make decisions, for example through illness, an appointed individual will be able to act on your behalf. If a Power of Attorney has not been drawn up in advance of an illness, such as Alzheimer’s, an application needs to be submitted to be able to look after the sufferer’s finances. This can be an arduous process and may cause distress for the sufferer’s family.