Inheritance Tax : Cash Gifts (not just) for Christmas
The New Year is the perfect time to make a Will. People in their 20s often think they do not need a Will, particularly if they are single and do not consider themselves to be particularly ‘well off’. Preparing a Will is not something you should delay. Here are 10 good reasons why you should make a Will now, regardless of your age.
If you die without a Will, the law states that your closest living relative will be the person entitled to administer your estate. When you are in your 20s this is likely to be your parents. Perhaps you do not want to put this burden on them or you would just prefer that someone else be the one to dig out all of your papers and personal information. In your Will you can choose the people you want to be your ‘executors’ and carry out this role.
If you die without making a Will, the intestacy rules will dictate who inherits your estate. While you are in your 20s, this is most likely to be your parents, who would get half each. Your parents may already be in a healthy financial position and extra funds may just lead to a greater inheritance tax bill on their deaths. You may prefer for your assets to pass to your younger brothers or sisters or perhaps to nieces and nephews. The only way to be certain this will happen is to make a Will.
Unless you are married or in a civil partnership, your partner will receive nothing from your estate under the intestacy rules (even if you are engaged). If you want your partner to benefit on your death, you will need to make a Will.
Pets hold a special place in our hearts. You may wish to state who should look after your pet when you die. You can also set aside a sum of money in your Will to help care for your pet.
You may not have huge cash sums to give away in your Will, but no doubt you will own items of sentimental value, such as jewellery or photos. Perhaps these items would mean something to certain friends or relatives. A carefully drafted Will can be accompanied by a letter directing who should receive your most prized possessions.
You may not own many high value assets or have a large sum of money in the bank now, but your Will doesn’t just deal with what you own now – it will deal with whatever you have when you die. If your parents are wealthy or own their own property, you may well be due to receive a significant share from their estate in the future. You should make a Will to ensure that you are in control of what happens to that inheritance.
People often use their Will to set out their funeral wishes, for example if they want to be buried or cremated. This can be accompanied by further details of what you would want to happen at your funeral, for example, what music you want to be played.
If you have a relatively small bank balance, it might not be a life-changing amount to leave to your family but it might make a big difference to a charity. You can use your Will to leave some or all of your money to a charity which is close to your heart.
We are living in a digital age. Many of us store at least some information electronically and you may have a number of online accounts, whether for social or practical reasons. Whilst digital assets are not generally considered to be assets that you own and can give away, you can leave wishes suggesting what should happen to any personal digital assets such as online photos, blogs or social media accounts when you die.
You may be lucky enough to have got onto the property ladder during your 20s. If you have, you should state what should happen to that property when you die. If you own the property jointly with another as ‘tenants in common’, a Will is particularly important, as it means that your share of the property does not pass automatically to your co-owner on your death. If the rules of intestacy apply, then your closest relatives will get your share. If you want your co-owner to inherit then you must either make a Will or make sure you own as ‘joint tenants’.
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