Why you need to discuss death with your family this Dying Matters Awareness WeekBack
Many people see death as a forbidden topic, never to be discussed as it’s too sad or difficult to confront.
In reality, talking about death shouldn’t be so taboo – after all, it’s going to happen to everyone at some stage.
Dying Matters Awareness Week ran from 2 to 6 May this month, encouraging everyone to talk about dying, death, and bereavement in an open and honest way.
So, this year, you may want to consider discussing death in frank and candid terms with your loved ones.
Here’s why it can be so useful.
It can happen at any time
You may feel as fit and healthy as ever, but the truth is that no one can possibly know when their number will be up.
So, as morbid as it seems, it may be sensible to prepare your family for your death before tragedy strikes and it’s too late.
Think about the effects that the Covid-19 pandemic will surely have had on thousands of families throughout the world.
Many people will have been left in the lurch, suddenly losing someone close to them and being entirely unsure of what to do.
Unexpectedly losing you would be enough of a shock for your family as it is. Don’t let that happen without first having discussed what they need to do next.
You should make sure your family are prepared for their responsibilities
Aside from the obvious emotional burden, death also usually comes with a great deal of administrative responsibility.
That’s why you need to make sure that your family members are prepared for these duties when the time comes.
Consider taking the time to discuss your estate in detail with your family. This can seem somewhat exhaustive as there can be a lot to think about, but a few good starting points could be:
- Showing them your will, including who you’ve selected as your executors and the outline of your plans
- Providing details of your wealth, such as how much you have in savings and investments
- Any plans you’ve made for probate, such as any professionals you’ve named to assist your family in this process.
By talking openly about your plans, you can help lift some of the pressure on your loved ones, helping to make sure that there are no surprises.
It could prevent potential disputes
The last thing you want to happen on your death is for there to be any disputes between family members about who’s entitled to what portion of your estate.
Having a comprehensive will in place no doubt helps with this, outlining exactly what you want to happen. But really, there’s no substitute for explaining this directly to your loved ones while you still can.
Tell those around you how you’ve decided to divide your wealth and be willing to explain why. That way, everyone knows where they stand and why you’ve made certain decisions.
This also gives your family a chance to have their say about what they would like to happen. This may even expose some areas where your planning hasn’t been as fulsome as you’d like.
Consider having your financial planner present for this conversation, to facilitate these discussions and make them constructive rather than argumentative.
There may be an Inheritance Tax bill to pay
When your family come to inherit your wealth, they may have to pay a 40% Inheritance Tax (IHT) bill on any of your assets that exceed your nil-rate band (NRB) – currently £325,000 in the 2022/23 tax year, or up to £500,000 if your direct descendants inherit your home.
This may come as a particular shock to your beneficiaries if you haven’t discussed it with them or made provisions to help them settle it.
Meanwhile, you can remove the stress this may present by showing your loved ones what you expect you’ll owe and any preparations you’ve made to help them pay it.
Of course, there are things you can do to potentially reduce the bill your family may face. In fact, you may have read our previous blog in which we discussed a few strategies that can help reduce IHT, from gifting assets to trust planning.
Make sure you speak to us if you’d like to find out how you could reduce your IHT liability.
It might encourage your parents to discuss their estate plan with you
A great bonus of discussing your plans with your family members is that it may encourage those around you, such as your parents, to talk about their plans with you, too.
Just as those around you will want to be prepared for your death, it’s also useful for you to know the responsibilities you’ll have when your parents pass away.
Whether that’s understanding the decisions they’ve made in a will or knowing what sort of IHT liability they have, being open about your own situation may encourage those around you to do the same.
Speak to us
If you’d like any help with planning for your death, whether that’s help creating your estate plan or simply mediating conversations with your family, please do get in touch with us at Holborn Financial.
Email email@example.com or call 020 8946 8186 to find out more about how we can help you.
The Financial Conduct Authority does not regulate estate planning, tax planning or will writing.
This article is for information only. Please do not act based on anything you might read in this article. All contents are based on our understanding of HMRC legislation, which is subject to change.