A common question some of our clients ask us is the basic cost of their Will. ‘You told me that my Will would cost £40 – so why am I paying more?’ At Wills & Legal
Services we offer some very competitive Will Writing packages, and our Charity Wills have proved to be a huge success for more than 10 years now.
But we would be lying if we suggested that all Wills cost £40 – the suggested donation for one of our Charity Wills – and not a penny more.
Just like insurance policies, our duty of care as a professional company is to ensure you and your family have the protection you need when life’s various ups and downs are thrown at you. Insurance policy costs can vary depending on a whole plethora of variables. A Will is no different to that.
A major concern for many people is that their home may be used to fund care costs in later life. And this could happen if you have just made a simple Will or Mirror Will.
Upon first death, your home will default to the survivor. If the survivor then goes into care and no other assets are available to fund care costs, your local council will means-test 100% of the property value and may request sale of the property.
To combat this risk, we have to put in place a means of insurance which protects you against losing your home.
This is one situation where our Paralegals would discuss that you take out a Protective Property Trust (PPT), which helps you protect your share of the home, thus ensuring that it is passed on to the people you care about most.
Yes, this additional policy comes at an additional price, but we believe that cost is invaluable, far outweighing the money involved trying to cover crippling weekly care fees.
What is the cost of setting up a Property Protection Trust?
At Wills & Legal Services we’re transparent about our fees and we strongly believe that a Protective Property Trust is the most affordable way of helping you protect your share of your home. Our fee for this package is £785 but this can be reduced by up to 50% if taken with one of our Estate Protection packages. But we believe this is a small price to pay if it safeguards your family financially. We’re a firm with strong family roots and we want the best for your family too.
But how does it work?
Most people own their property jointly as Beneficial Joint Tenants, meaning that typically the house passes to their spouse on first death and to their children or beneficiaries on second death.
A PPT has to be created whilst both partners are alive. The joint tenancy of the property is severed, meaning that Mr and Mrs Bloggs, for example, will then own 50% of the property each. This is known as ‘Tenants in Common’.
Following this procedure, Wills & Legal Services would then create a new Will with the PPT incorporated, meaning that upon first death, instead of leaving the share of the property to the surviving spouse, their half will be held in trust for the beneficiaries (usually the children) of the Will.
Therefore if the surviving spouse goes into care, the local council can only means-test the other 50% of the value of the property. So the surviving spouse has a ‘life interest’ or ‘right of occupancy’ and can live in the property for life, or substitute it for another one.
How does this help with care costs?
As we mentioned, care fees can be very expensive – and many people just aren’t aware of how much these fees are. Average residential care fees are often well in excess of £700 per week. No, that’s not a misprint – it could cost you this much in care fees alone, so it wouldn’t take long to erode the value of your estate. The bricks and mortar that you’ve worked so hard for over several decades could be eaten up in a fraction of that time.
What’s more is that anyone with assets above £23,250 may not currently receive state help with care costs, again meaning that many families would have to sell their home to fund care.
Yet if a PPT has been established, then half the value of the property is automatically protected on first death and the deceased’s share will not be used to fund care cost for the survivor. So you can see why a Protective Property Trust could save you thousands.
Are there any other benefits?
Yes. If the surviving partner remarries, the deceased’s part of the Will cannot be changed, thereby protecting the beneficiaries’ inheritance by preventing the deceased’s share passing to a new family, rather than your own, which is known as sideways disinheritance.
Sideways disinheritance can be explained in five simple stages:
- The first spouse dies
- Their assets go to the survivor
- The survivor remarries
- The survivor dies
- The assets go to the new spouse
If this is something that you really don’t want to happen, then a PPT would be just what you need.
A Protective Property Trust is also very useful for couples who have children from different partners. A PPT ensures each partner’s share passes to their child or named beneficiary whilst the surviving partner has the legal right to remain in the property for the rest of their life.
There are several other packages that we offer that could also influence the cost of your Will. See our blog on What is a Paralegal to discover how else we can help you safeguard your assets.
We hope this explanation makes it clearer as to one of the reasons why your Will may have cost you more than you were expecting. But, as with anything, the more you put in, the more you get out.
If you would like to discuss a Protective Property Trust with one of our friendly Paralegals, call us on 01885 490380 or via our online contact form.