From today (6 February), the fixed amount a surviving partner is entitled to when a spouse or civil partner dies without making a will, is rising from £250,000 to £270,000.
The fixed sum is known as the ‘statutory legacy’ and is designed to balance the interests of the surviving spouse with those of the deceased’s children when no will is in place.
For the millions of adults in the UK without a will, the fixed inheritance sum increase is a safety net – but is no substitute for making sure the right people get what you want them to have after you die.
Here, we look at what the change means for your loved ones and how you can avoid the risks of your partner struggling to keep their home and lifestyle when you’re gone.
In the UK, as many as 5.4 million adults don’t have a will, according to insurer Royal London, which means their wealth will have to be shared out under the rules of intestacy.
If you die without a will, property you own together as joint tenants and money held in joint accounts will automatically pass to your spouse.
The statutory legacy sum, which rises from today in England and Wales, applies to everything else.
So, if you have children, your spouse will get the first £270,000 and half of everything else. The other half will be divided equally between your children.
- Find out more: intestacy rules explained
Why is this happening now?
The statutory legacy sum was introduced in 2014 to modernise and simplify inheritance law.
It was designed to make it fairer and easier for those left behind when no will is in place to set out the deceased’s wishes.
The fixed amount is meant to be updated at least every five years to catch up with inflation as measured by the Consumer Price Index (CPI).
It was last revised in October 2014, and this latest increase sees it rise 8% from £250,000 to £270,000.
Who is at risk?
While at first glance, extra inheritance for the remaining partner looks like their interests have been protected from erosion by inflation.
However, they could still be at risk of far worse – of losing their home and lifestyle.
For the remaining partner, with no will in place the statutory legacy sum means:
- Assets or money you might need is automatically shared out among the deceased’s children.
- It may be down to the children to decide whether they help you out.
- You stand to lose money or assets that your late partner had held even though they had intended to share these with you.
- You could be landed with an inheritance tax bill that could have been avoided.
The worst-case scenario
If you’re married or in a civil partnership and don’t have a will, the statutory legacy sum offers some protection, but there is none for unmarried couples living together without a will.
It doesn’t matter how long you’ve been together – aside from any jointly owned property or accounts, your estate will go to your children.
If you don’t have any children it will pass to other family members – so if your property is in your name alone, your partner could lose their home.
- Find out more: why unmarried couples need a will
How to protect your family
In all circumstances, whether married, in a civil partnership or cohabiting, the single most important action to take is to make sure you both have a valid and up-to-date will.
Making a will is the only way to ensure you leave money to the people you want to benefit, at the right time and in the way that suits you best.
Another step to take can be to balance out your assets so that they’re not all in one name.
- Find out more: how to make a will
Where to get help writing a will
Drawing up a valid will needn’t be a lengthy or difficult business. It’s possible to write one online in 30 minutes, savings days or years of potential heartache for loved ones later on.
To familiarise yourself with wills in general, you can turn to our range of guides on wills and probate.
Once you’re ready to write one up, you can approach a lawyer or online service.
The Which? Wills service provides single wills and pairs of wills for unmarried people, as well as a full range of options for married people.
You can choose from three levels of service:
- Self-service £99 for a single will or £156 for a pair of wills. This is the most basic option and allows you to fill in your will online in your own time with helpful hints and tips.
- Self-service, plus a review £119 for a single will or £189 for a pair of wills. The review service gets your will looked at by one of our wills experts, which gives you extra peace of mind that you will have a legally binding will.
- Premium £169 for a single will or £259 for a pair of wills. With the premium level, you get everything offered from the other tiers plus bound copies of the wills are stored by Which? Wills for a year.
Which? Wills also offers a simple-to-use way to create a Power of Attorney, which can help set out your wishes for who you want to be in charge of your welfare and finances if you fall ill.
- Find out more: Power of Attorney explained