What if I simply decided to do nothing at all?
After all, why get all hot and bothered when my wife will get everything anyway? I am likely to die first, so the problem of the children’s inheritance is really down to her – not me; she’ll be fine inheriting all my stuff automatically.
This is called intestacy.
My estate is divided in accordance with what are commonly known as ‘the rules of intestacy’, which are derived from different statutes. It breaks down to (a) who is the administrator of the estate ( ie “personal representative” – which is in my case probably my next-of-kin – ie widow), and (b) who gets everything (next of kin – ie widow again).
The only complications of modern lives – such as people with previous marriages (or relationships that bore children), civil partnerships, transgenders, adopted children, jointly owned properties, trust funds, debts, hire-purchase agreements or financial arrangements of that ilk – simply do not apply to me and my situation just now.
My life is pretty simple – wife and children, no HP, nothing being paid up or paid back. As simple as it gets.
The worst that can happen to me is that my wife dies first, but in terms of intestacy, it’s still basic and straightforward.
Nevertheless, I have some concerns. A Personal Representative / Administrator (ie my widow) is personally financially liable for any loss resulting from a breach of their duty, even if the mistake was made in good faith; such as
- Failure to pay my debts and liabilities;
- Failure to pay all Inheritance Tax, Income Tax & Capital Gains Tax due.
- Failure to distribute funds to an individual who is successful in their claim against the estate;
- Failure to identify, and correctly distribute funds to the beneficiaries; including those initially not known about.
This can go on longer than I would have thought; my creditors can potentially make a claim against my widow/ Administrator for up to 12 years after my death! And disappointed family members or dependants have up to 6 months to make a claim after the Grant of Representation has been issued.
There are always further unknowns – so it is a real concern.
Doing nothing means leaving all the bother and fuss to my widow – right at the time she doesn’t need such aggravation.
Is she really the best one to be Administrator? I am not so sure this would be a great idea.
Fact is, if I decided against dying intestate, and went for arranging a will – is she the best person to be the executor? If I get a life insurance policy written into trust, should I get another trustee or two to help out?
And another thing – as husband and wife, we are a couple – and so we do things together – so what would happen to the children if something happened to us both?
How would funerals be managed and paid for?
All things considered here, it is really not the best idea to do nothing. Intestate is not a good state.