It is rarely easy to talk to your loved ones about what you would like to happen after your death – especially where those discussions might centre on awkward topics like wealth, inheritance or illness, or there is a risk of conflict emerging as a result.
Indeed, recent research by financial advisory firm abrdn has highlighted just how difficult we find these conversations, with 10% of survey participants saying that they consider inheritance tax (IHT) to be a ‘taboo’ subject, and 16% admitting that they would find mental health – also a subject many of us shy away from – easier to discuss than wealth planning.
Whilst this general reluctance is a universal theme, abrdn’s research shows that these difficulties become even more apparent in the context of so-called ‘blended’ families.
Blended family structures, which usually involve second relationships and/or step-children, can present greater complexities for estate planning purposes, particularly where people are keen to provide for partners and children from both current and previous relationships.
In addition, the intestacy rules, which apply where a deceased person does not leave a Will, do not cater well for less traditional family structures, with spouses and civil partners taking priority over children if there is insufficient money in the estate to provide for both, and no provision made for partners who are not married or in a civil partnership.
Despite these additional challenges for blended families, abrdn’s survey suggests 47% of blended families have not taken steps to make or update their Wills following key events such as re-marriage, divorce or having children.
As marriage generally revokes an existing Will, and an ex-spouse is treated as written out on the date of dissolution, re-considering your intentions for succession are particularly crucial on the occurrence of any of these life events. Moreover, 21% of blended families surveyed said they had not yet discussed the issue of succession with their partners.
This reluctance to hold these conversations, together with the impact of the intestacy and other rules, are perhaps contributing factors to the fact that a high proportion of those surveyed from blended families had not inherited the wealth they were expecting to from their parents.
Interestingly, however, abrdn’s research also shows that 51% of people from blended families are aware of the importance of planning for the future, even where they have not yet taken steps to do so. This suggests that the problem is not necessarily a lack of awareness as to the importance of lifetime planning, but rather a lack of certainty as to how or where to start.
This is understandable given the perhaps increased risk of conflict or upset when members from different family groups are involved, but avoiding these difficult conversations can often make the situation worse after your death, as shock or disappointment can result in legal disputes, especially where a Will, or the intestacy rules, fails to provide for someone who was dependent on you during your lifetime.
The good news is that there are numerous resources which can help to make tackling these issues a little bit easier.
Talking to professional advisers – whether solicitors, financial advisers or accountants – can be of huge benefit when navigating the different options for lifetime planning and discussing your intentions with your loved ones.
At Hunters, we have a vast wealth of experience in supporting families of all kinds through the various stages of life, and our Difficult Conversations campaign has been specifically designed with these issues in mind.