Pre Death Planning can save a fortune.
I was inspired to update this article when a new widow rang up distress because the Post Office had told her she needed probate to access her husbands £12,000 savings to pay for his funeral. Probate is currently (10/19) taking MONTHS, so that was scarcely sensible. In fact, the clerk should have refered her to the Bereavement Team. They would have explained that they COULD pay for the funeral out of his account, provided they paid the undertakers invoice direct. If she (you) pay yourself in these circumstances, they will NOT repay you, and will only release the money on receipt of the Grant of Probate or Letters of Administration.
So part of pre death planning is to quiz banks etc on the limits they will release on death of an account holder. Remember to ask which other banks are part of the same group, as the limit is likely to cover all of those banks. No good moving money from one bank to another in the same group!
Clearly, the ideal way to deal with funerals is to have a chat with our colleagues at the Prepaid Funeral Review, and get that problem out of the way in advance. Many funeral directors charge substantially more for funerals paid for on death.
In general terms there is a bit of a checklist on www.LegalPlanning.co.uk which may help as well as reading this article.
But back to the banks etc – you can clearly reduce balances to below their limits for requiring probate, or you can make accounts joint, which means they pass automatically to the survivor on production of a death certificate. That does NOT mean that they can be ignored if probate is required, or if IHT may be payable, it just makes the transition a little easier financially.
Set Up an Emergency Folder.
I have been preaching this for years, and, of course, hadn’t done it. But it is simple – in the event of emergency or death, someone will need to be able to access your records. Car insurance, house insurance, life cover, pensions, bank details (just the branch if your records are not secure), National Insurance number, NHS number etc etc.
The wife eventually made me do it, and I just use a lever arch file with a poly pocket for each item. Things like Wills and Powers of Attorney need more security and yes, we have a sister company which offers that and much more – the Will Custodian Peace of Mind Service offers secure storage and a the ability to review and then update planning.
Review everything regularly.
Please don’t leave it too late. So many people leave aged relatives to deal with the complexities of probate, or (worse) Lasting Powers of Attorney. they leave money to children who may well be old, or on benefits (which they then lose). Wills ought to be reviewed every 3 years or so, and consideration given as to whether the recipients are actually in need of
Not that it’s our field, but savings accounts need regular review, as do investments (no sister company here, but we do know some good advisers.)
Pre death planning, especially for those who receive notice of their own death, through a bad diagnosis – or just plain common sense realisation that we are all going to go sometime! A great deal can be done to tidy up their pre death planning before they die, saving a great deal of cost and time. Click the link above for our contact details.
No one else seems to take this issue seriously, so we are starting a bit of a campaign on it. Not only may we save your family time and money on probate, but (for some) there may be massive savings on Inheritance Tax or Capital Gains tax.
If you or a relative are in this situation, a few hundred pounds spent now on pre death planning could save thousands of pounds and long delays after you have gone. You will no longer be not available to answer all of those questions your Executors will be required to answer.
There is a what to do when someone dies available on our site, but the following may also be useful:
Our sister company has provided us with a number of useful Guides, currently all free of charge as they are not 100% up to date, but there are many usefull pointers in them.
1) Inheritance Tax Secrets
This site offers a brief (pages 50 to 60) Manual which can help you to massively reduce the Inheritance Tax bill on death, and advance planning is often very simple. Trouble is most people mess it up as they don’t want to pay thousands for professional advice – now you don’t need to.
2) Asset Protection Secrets is FREE
It is a brief booklet which helps introduce you to the topic of asset protection which is becoming increasingly important to pre death planning as pressure grows on the tax man and local councils to increase revenue. You have the choice of giving your assets as tax, or leaving them to your family, so why not find out how? It also shows you how to get some of your assets outside of your estate (but not for IHT, that is another topic) so that it can be paid out quickly without probate delays. Things are changing rapidly in this area and we can ask our sister company to advise you.
There is a free guide to legal planning on this site too – and it is just one sheet of A4, which could save an awful lot of aggravation and cost.
4) Pre paid Funerals – can save time, money and lots of family arguments. Everyone seems to know what the deceased wanted. But they all “know” something different!
5) Detailed Estate Planning
For more (paid) advice on pre death planning, please contact us and we will get a suitable adviser to contact you. We believe that many folk would be delighted to help sort out all their paperwork, or as much as they can manage, before they die. At least it takes their mind off the inevitable. Early planning can save hundreds, thousands or even tens of thousands of pounds. Probate Practitioners being able to question people before they die would make life much easier and hence cheaper in the long run.
Pre Death Planning = post death savings and simplicity
We haven’t recently checked this, but limits don’t often change – let us know if you find any have been updated please.
Probate Limits of UK Banks, Building Societies and other Institutions
- AA (Bank of Ireland)
- Aviva – £50,000
- AXA – £10,000
- Bank of Ireland – £10,000
- Bank of Scotland – £25,000 (HBOS)
- Barclays – £50,000.
- Barnsley Building Society (Yorkshire BS)
- Birmingham Midshires – £25,000 (HBOS)
- Britannia – £30,000 (Coop)
- Cahoot (Santander)
- Chelsea Building Society (Yorkshire BS)
- Cheltenham & Gloucester – £25,000.
- Cheshire Building Society (Nationwide)
- Clysdale Bank
- Co-op Bank – £30,000
- Coventry Building Society
- Derbyshire Building Society (Nationwide)
- Dunfermline Buidling Society (Nationwide)
- First Direct – £20,000 (HSBC)
- Halifax – £50,000 (HBOS)
- HSBC – Decided on a case-by-case basis.
- Intelligent Finance (HBOS)
- Lloyds TSB – £50,000 – although they own HBOS, we understand their licences are separate.
- M&S Money – £15,000 (HSBC)
- Under £5,000 – no Grant of Probate is required.
- £5,000 – £30,000 – a certified copy of the Grant of Probate is required, or the ‘close account’ form will need to be witnessed by a Solicitor
- Over £30,000 – the original Grant of Probate is required.
- Natwest – £25,000
- Norwich & Perterborough Building Society (Yorkshire BS)
- NS&I (National Savings / Premium Bonds) – £5,000 to £15,000 depending on the Will and the number of Executors
- Post Office – £10,000 (Bank of Ireland)
- Royal Bank of Scotland – £25,000.
- Saga (HBOS)
- Sainsbury’s Bank – £20,000
- Santander – £50,000
- Skipton Building Society £15,000
- Smile (Coop)
- Standard Life (Barclays)
- Stroud & Swindon Building Society (Coventry BS)
- Tesco Bank – £25,000
- Triodos Bank
- Virgin (Clydesdale Bank)
- Woolwich – £15,000
- Yorkshire Bank (Clydesdale Bank)
- Yorkshire Building Society – £30,000.