Why and how to talk to your family about your estate plans

A report by The National Wills Register shows that 53% of UK adults haven’t spoken to anyone about what should happen to their estate after they die. What’s more, 15% do not believe they need to (or are reluctant to) do so.

While you might feel uncomfortable talking to your family about a time when you’re no longer around, failing to do so could lead to complications, expense and distress for those you leave behind.

In contrast, discussing your estate plans openly could ensure you and your loved ones have a shared understanding of your wishes. This may strengthen your relationships and provide valuable peace of mind for you and the most important people in your life.

Read on to find out why discussing your estate plans with your family is so important and discover four practical tips for addressing this potentially challenging and emotional topic.

Ensure your wishes are followed

Talking through your intentions with family members as early as possible gives them time to ask questions and accept your wishes. This increases the likelihood that your choices will be respected and carried out as you planned.

On the other hand, if you keep your loved ones in the dark about your estate plans, there may be a greater risk of your intentions being misunderstood or misinterpreted when emotions are running high.

Reduce the risk of family disputes

According to research published by Today’s Wills & Probate, there was a 5% rise in contested wills between 2022 and 2023. One primary reason for this increase is believed to be ‘family disappointment’, which occurs when the will doesn’t align with what the family believed the deceased wanted.

As such, managing your loved ones’ expectations is crucial if you want to protect them from potentially lengthy, costly and stressful inheritance disputes.

Having open conversations about your estate plans could reassure your chosen beneficiaries that your decisions are deliberate, considered and independently formed. If they know that your plans reflect your long-held intentions, this could reduce the risk of disagreements and legal battles.

Help your loved ones plan

Giving your family clarity on what they can expect to inherit from you allows them to effectively plan their long-term finances and make informed decisions about their futures.

Research by Canada Life reveals that almost one in five adults in the UK who have received or expect to receive an inheritance are delaying or plan to delay a major life event – such as buying their first home – until they receive this wealth.

If your family are mistakenly relying on an inheritance from you, they might face financial challenges or hardship when this doesn’t materialise.

In contrast, being transparent about your intentions ensures that your loved ones have the information they need to make realistic financial plans for achieving their goals.

Identify and address any issues early

Talking through your estate plans might uncover practical issues, such as the need to update named beneficiaries or executors. It could also ensure that anyone you have chosen to fulfil a specific role, such as being the executor of your will or a guardian for your children, understands and accepts these responsibilities.

Additionally, you might learn things about your loved ones that lead you to amend your estate plan. For example, rather than leaving your child an inheritance in your will, you may decide to gift it to them during your lifetime to provide financial support when they need it the most.

Protect your health and finances if you lose mental capacity

Your estate plan isn’t only about passing on your wealth. Including Lasting Powers of Attorney (LPA) allows you to nominate one or more people you trust to make decisions on your behalf about your healthcare and finances if you lose mental capacity to do so yourself.

Talking to your chosen ‘attorneys’ and your wider family about these plans could make it easier for your loved ones to make important decisions and ensure that your assets are accessible if needed.

4 practical tips for having difficult but important estate planning conversations

If you feel uncomfortable talking to your family about your estate plan and don’t know how to start the conversation, here are four tips that may help:

1. Explain your main intentions

Rather than launching in with figures and legal details, focus on why you’ve made the plans you have. Explaining the reasons behind your decisions could help your family understand and accept your wishes.

2. Share information about key documents

Sometimes the simplest and most practical matters are the easiest to overlook. Make sure the right people know where key documents are. These might include your will, paperwork detailing any trusts you’ve set up and LPAs.

Remember to share contact details for relevant professionals (your solicitor, financial planner and so on) and login information for any important digital files.

3. Identify individual responsibilities

The effective execution of your estate plan relies on key people taking action. Talk to anyone you have nominated to undertake individual responsibilities, such as the executors of your will. Ensure they know what they need to do and that they have access to the necessary information to fulfil their duties.

It’s also important to let the rest of your family know who is doing what, to avoid any misunderstandings or disagreements.

4. Involve your financial planner

If the thought of facing these difficult conversations alone feels daunting, reach out to your financial planner for support.

Having an impartial third party involved could help you and your loved ones manage this sensitive matter calmly and logically. Your financial planner can also offer practical guidance on matters such as pensions and inheritance tax.

As a result, you could create an estate plan that gives both you and your family valuable peace of mind.

Please note

This article is for general information only and does not constitute advice. The information is aimed at retail clients only.

All information is correct at the time of writing and is subject to change in the future.

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.

The Financial Conduct Authority does not regulate estate planning, tax planning, trusts, Lasting Powers of Attorney, or will writing.

A pension is a long-term investment not normally accessible until 55 (57 from April 2028). The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Past performance is not a reliable indicator of future performance.

The tax implications of pension withdrawals will be based on your individual circumstances. Thresholds, percentage rates, and tax legislation may change in subsequent Finance Acts.