Estate planning is no longer reserved for high-net-worth individuals. It is now necessary for all families to support the next generation during their lifetime, as well as plan for what happens after death.
In this blog, Daniel Brown, Trainee Solicitor in our private client team, explains why lifetime giving, clear records, and regular estate planning reviews can help families avoid uncertainty, disputes, and unnecessary tax issues.
Supporting the Next Generation During Your Lifetime
Ultimately, the spending power of young adults has reduced significantly in comparison to the baby boomer generation, which currently holds the vast majority of wealth. Therefore, parents and grandparents are increasingly helping with house deposits, rent, business ventures and other financial pressures. It is, however, important to be clear when passing this wealth whether the funds are being given as a gift or a loan. Without accurately compiled records, it can lead to uncertainty later if there is disagreement, divorce or death, for example.
Lifetime Giving and Inheritance Tax
Lifetime giving can also affect the estate for inheritance tax purposes, and it is important to be aware of this to ensure there are no large, unaccounted-for inheritance tax bills left to the next generation.
Some gifts may fall outside the estate if the donor survives seven years, while annual exemptions and regular gifts from surplus income may also be useful planning tools.
However, recording and utilising these exemptions is not always straightforward, and advice should be sought in this scenario.
What Modern Estate Planning Should Include
Modern estate planning should also include pensions, life insurance policies, digital assets and regular reviews.
Careful planning can help families provide support while reducing uncertainty, disputes and avoidable tax issues.
Need Advice on Estate Planning?
If you are considering helping children or grandchildren financially, or you want to review your wider estate planning arrangements, it is important to take professional advice before making decisions.
Our private client team at Berlad Graham can advise on Wills, Inheritance Tax Planning, Lifetime Gifts, and Estate Planning for families. To speak to our friendly, experienced, professional private client solicitors in Uxbridge today, please call 0330 175 5655 or email info@bglaw.co.uk.
Read some of our earlier articles for further related information:
