Sometimes, I think too many of us in the professions, including perhaps solicitors and accountants, make assumptions about clients’ expectations from us without asking them what they think.
Over the years, as I’ve matured in my role and as clients have grown with me, I have found myself helping them with a wide range of financial and life planning issues, some of which are outside of my usual area of expertise. Thankfully, I think I’ve learned what questions to ask and where to guide people in finding the right solutions. Quite often I find that I need to point clients towards one of the other professions to get specialist expertise. In my role as an Independent Financial Adviser I think it is important to help people carefully consider the bigger picture over the longer term.
The main areas of discussion seem to be around Wills, Trusts and Power of Attorney, usually in that order and all of which are more likely to be the domain of a family solicitor.
It is surprising how many people do not have up to date Wills, or indeed any type of Will at all. It can be very difficult for a family, or other loved ones such as a partner, to find that the financial affairs are so difficult to sort out at such a traumatic time.
When a person dies without leaving a valid Will, their property must be shared out according to Rules of Intestacy. This can lead to a spouse not receiving all of the estate, as some of the estate may need to be held as a life interest. This may be far removed from what was intended.
For unmarried partners, same sex or not, things can get even more difficult, as they may inherit nothing and could even find that they need to find a new home for themselves.
It is possible to do a DIY Will, or use a Will writing company, but be careful that this is not as it could be a false economy if things are not done correctly.
Quite often I find that people in their later years become acutely aware of the likely cost of Inheritance Tax and sometimes leave it too late (but not if I can guide them to take action early enough). It is a difficult decision to give sizeable amounts away and this is where Trusts can be a great help. We find that more and more people look towards trusts for the eventual benefit of children, or more likely grandchildren. A trust can help protect the assets against future unexpected events in a family such as a divorce or untimely death of a beneficiary. The other big benefit of a trust is the potential to protect the assets from Inheritance Tax, currently at a rate of 40%.
As people approach old age they might become more concerned about how they will cope with daily living tasks in the event that they become ill or frail. My own parents are getting on in years and although still live independently I encouraged them to arrange Lasting power of Attorney. I helped them with the paperwork in setting these up and even though I am used to dealing with financial matters I found the procedure quite challenging and somewhat long-winded.
It is possible to download the forms and deal directly with the Office of Public Guardian on a DIY basis. My own experience suggests that this should only be done if you have good knowledge, a lot of patience and an eye for detail. Any mistake on the forms will significantly hold-up the procedure and cause a lot of frustration. I think this is best left to the professional advisers.
Power of Attorney comes in two parts – Financial and Welfare and a good adviser should help you to decide which parts you need.
It is not inexpensive to set up the Power of Attorney through a solicitor but it can be money very well spent.
For any of these services, Wills, trusts, power of attorney, I would usually guide a client towards a good solicitor and I would suggest a firm that I think will suit the client, as solicitors come in different shapes and sizes, as do clients.