Is there any point in making a will in our scenario?

[aWillQn]

DH and I own a house with approx 75% LTV mortgage.

One child.

No savings. I have a couple of grand in shares.

If I die, DH is named on my pension and will get my death in service grant. If DH dies, I am named on his pension.

I don’t see the point of a will - if I died tomorrow surely my 12.5% ownership of the house simply goes to DH? And vice versa?

How exactly is a Will going to protect ‘half a property’?

Only a house owned as Tenants in common is split in half ( or another percentage). If you were tenants in common then you would obviously have a will ( you would have to be very very stupid not to).

I'd do it - but I'd also use the cheap will writing service that some charities offer - or one of the free months.

It's just so much easier administratively if you have a will in place. Also consider doing Powers of Attorney. A friend of mine's brother has lost capacity in his 50s and having no Power of Attornery in place is causing no end of trouble...and cost.

My husband died recently and I am dealing with the estate. I don't have experience of dealing with an intestacy case but having the will has certainly made things straightforward. I would make one as the only disadvantage of doing so is the relatively small amount of time and money it takes. Many of the advantages have already been mentioned, but consider:

1. Appointing a guardian and setting up trust/intentions if you both die while your child is a minor.
2. If the house is held as tenants in common the estate might be larger than you think
3. Your circumstances are likely to change in the future and you may well have more money than you think you will at that point. Most obviously, if one of you dies through a terminal illness then you might have critical illness/life insurance/pension payments before death that then become part of the estate. You might have a very limited time between getting these and the death and your focus is clearly not going to be on money in this scenario (ask me how I know... so don't assume you'd just sort it out at the time.

Basically I can't see why you wouldn't. Hopefully will be unnecessary but you might be very glad if you do end up in needing it.

FiL caused chaos when he died as the rules for what happens if you die without a will vary a lot. In Wales, due to the way the house ownership was set up, MiL could have had to sell up and give SiL, as the only child of that marriage, a significant portion of the inheritance. Thankfully they found a will after MiL got a shock and thought to call the solicitors.
Look up what may apply - https://www.citizensadvice.org.uk/family/death-and-wills/who-can-inherit-if-there-is-no-will-the-rules-of-intestacy/

I agree with guardianship for your child, plus will your will allow £x to support guardian?

That’s the thing though - there is no ‘inheritance’ to distribute - no savings or assets. Just 1/4 of a house between us really. Which would just go to each other.

But yes, good point on guardianship and the money going to the guardians. Though who on earth we would pick I have no idea. I have no siblings and DH’s sibling lives on the other side of the world. It really doesn’t bear thinking about.

I am 99% sure we are joint tenants, I remember checking this at the time. I will check again… somehow!

I am sorry for your loss @Sunnyphoenix.

I know we should also probably set up life insurance too, especially for DH as he doesn’t have a death in service benefit. But who can afford an extra £80/month these days, on top of everything else!

Yes this is an excellent point. I will look into how to do this. Thank you.

Not really sure why anyone on MN would make a will.

There are weekly threads wailing "but it's not faaaiiir" and posters handwringing about what to do with their anticipated inheritance because cousin x got nothing.

Usually before the person in question has even died.

Sorry, that's not really helpful OP - you've had some much more sensible advice from other posters. Just ranting really.

life insurance might be cheaper than you think, we pay roughly £15 per person for £250k pay out each.

There really wasn't much money either...

I think that the time when charities offer free will writing service is coming up soon, but having a straightforward will drawn up shouldn't be that expensive anyway.

Anyone who has had to deal with the aftermath of someone dying without a will, or with a very out of date will, will be tearing their hair out at your lackadaisical attitude to this. Similarly those of us who have had to deal with seriously ill relatives with no LPAs.

We were 'persuaded' to make a Will when our children were very young, and our accountant said that if anything happened to both of us, Social Services would take our children whilst 'things were sorted out'. Drove us to very quick action!

Please make a will. It will make the huge administrative task of death easier on your surviving family.

Honestly - who can afford not to...
We really didn't think it would be something that would happen to us. DH was incredibly healthy, energetic etc and here we are. I'm in a couple of bereavement support groups and the financial side makes such a difference to everything else - can you afford to keep your house, take a step back at work to support the kids etc etc. Definitely have a financial plan for the worst case scenarios.
And on the pension/wills thing, if you are in the unfortunate position of having a terminal diagnosis you can often withdraw the whole pension tax free (unless you have a huge amount, then some is taxed) which is often the best thing to do, but can leave you with an unexpetedly large estate.

Can I ask why you don’t think they need one? What about guardianship of their child if they both die?

It's much, much easier when someone dies when there is a will to deal with banks etc. Friends of our family, the wife died intestate, only the two of them, very simple estate. It took him a year to get access to one of her bank accounts.

We updated my mum's will about a year before she died and so glad we did, made everything so straightforward. You really don't want to be applying for letters of administration.

This. IMO that is the most important thing to do, along with ensuring that you secure your assets for your child, in a trust if appropriate, including life insurance, pension.
Suppose you die, your partner remarries, no wills, partner dies, new spouse gets everything. New spouse may decide not to provide for, or leave anything to, your child.
It happens all the time.
Everyone should make a will.

An angle to consider is if you die, DH meets someone else and gets married and then dies…what does your child get? In Scotland you can’t disinherit a child but you can in England. The new wife gets everything. I’d see if putting your half of the house in trust for your child is worthwhile.

And it has reminded me, we need to update ours now DDs are adults!.

Are you and your partner paying in to and employer pension scheme? Usually a death in service payment comes with membership of these. Often 2 or 3x basic salary so would help the surviving spouse pay off a mortgage or live on for quite a while.

I know private life insurance is expensive but if you don't have access to a occupational pension then with a child you really can't afford not to have it. Especially if one parent is not working or part time for childcare and the main provider dies. Both need to be insured.

Not having a will makes it so much harder to administer an estate; you’re bound to die one day so why not make it easier all round?

It’s worth making a will even if it’s just for if you’re the second to die.

Even though with one child everything goes to them, it’s a much easier process if there is a will to say that rather then leaving them to go through the intestacy process.

If your child is still young as well as guardians it’s worth having a will in place so there is an executor in place as well rather than having people wondering who should do it.

I’m an actuary so extra fun at parties! Off the top of my head…..

Do you have death in service payouts with your work and pensions. If so “dead you” could be worth a lot more than “live you”.
Do you have life insurance on your house? Decreasing term assurance is often surprisingly cheap.
Who do you want to care for your son if you both die. (And more importantly - is there anyone you really don’t want to?) Who do you want to control your son’s money until he is 18 if you both die? There may be more than you think with two “dead
yous”.
Do you want your son to get all the money left on his 18th birthday? Will he still be at school then?
What if all three of you die? If you all die in a car crash and are dead before the emergency services get there then they will assume the youngest one died last. Ie you son. So he will inherit everything and it will then be split between all 4 of his grandparents. However, if one of you manages to survive until the ambulance gets there then they died last and so inherit everything. So if your husband dies in the ambulance whilst you and your son died in the car then your death on service policy will go to his parents. Yours will get nothing.

Decreasing Term Insurance is usually quite cheap

You also want to decide at what age your child gets their inheritance if you die during their minority

Otherwise they get it at 18

For mine the money goes into a discretionary trust until they are 18.

You also need to consider what happens if you all die together