The NO Wedding Planner

Recent figures show a significant decrease in the marriage rate. From a peak in 1940 when, spurred on by an impending war, 426,1000 young couples married, in total just 228,204 marriages took place during 2008 in England and Wales.

The falling marriage rate is partly attributable to a rise in the number of people choosing to remain single but is mostly down to the fact that more and more couples are choosing not to marry and this has ramifications for their financial planning.

Let us consider the example of Paul and Sarah. They own a property valued at £600,000. The property is owned 60% by Paul and 40% by Sarah, reflecting their differing initial deposits. They have an outstanding mortgage of £100,000. The mortgage is covered by a life assurance policy which will pay out on the first death. They also have a joint savings account with a balance of £50,000. They have wills which leave assets to each other on the first death.

Sadly Paul suffers a fatal heart attack. His estate is valued as follows:

Property £300,000 (60% share less mortgage)
Life assurance benefit £100,000
Savings Account £25,000
Total £425,000

Assets passing between UK domiciled spouses are exempt from Inheritance Tax but the same exemption is not afforded to cohabiting couples and therefore the value of the estate above the nil rate band (currently £325,000) will attract Inheritance Tax at 40%. This means Sarah will need to settle a tax bill of £40,000 before probate can be granted.

The tax bill could have been easily avoided simply by writing the life assurance policy in trust so that it did not form part of Paul’s taxable estate. This would also mean that the proceeds would be available immediately without the need to wait for probate to be granted which can take many months.

The position could have been considerably worse had Paul and Sarah not written Wills. Under the laws of intestacy, where there are no children, cohabiting partners do not receive anything and Sarah could have found herself co-owning the house with Paul’s parents.

David Anderson is a Chartered Financial Planner with Concept Financial Planning

Concept Financial Planning Website

Is there anyone there? – Alliance and Leicester?

I thought I would write my story … to enlighten people and in the hope, that no one goes through what I have been through … so far.

My father passed away in May and since then I have had experienced the most stressful time dealing with Alliance & Leicester trying to get joint accounts changed to my mum sole name and any other accounts held in my dad’s name.

From the start Alliance and Leciester has shown that they have no idea how to deal with such a sensitive matter and at a difficult time for families. Their processes, if they have any? and inability to deal with them if they do, just cause unnecessary stress, grief and anxiety to those left to sort it out.

My poor mum is under enough stress dealing with her grief and as an older lady, with all due respect to her, really would not know where to start when it comes to dealing with the banks, and thankfully working within Financial Services and Customer Services for over 20 years, I have a huge amount of experience which meant I could take some of the pressure off of my mum. Unfortunately I had no idea what I was going to experience…..

In order to deal with the account on my mum’s behalf I had to complete some security forms which I had to request 3 times from Alliance & Leicester before I actually got them.

Trying to find someone to help in the first instance was my first battle and getting passed around to different departments and getting told different things was a regular occurrence.

I was told to make an appointment to see my local branch in Croydon to hand over the death certificate so it could be copied and sent to head office. The assistance I received at the branch was extremely worrying as the girl I saw did not have a clue what she was doing and I eventually spent the morning speaking to head office myself and relaying back the information to the branch.

Result I thought, however, the branch managed to lose the copy of the death certificate and to this day it has still not appeared within Alliance & Leicester. I even spoke to their credit card team the day I went into the branch to pay my mum’s outstanding bill which was due, and it only came to light some 2 months later that whoever I spoke to in head office was not in a position to take payment, so not only did we then get charged overpayment fees, I then I had to speak to a completely separate arm of the company to pay the bill, as no money had been taken from the current account!!!.

I eventually got through to the Probate & Trust team in Bootle who have been dealing with the accounts department……..even having a specific team to deal with I am now 5 months down the line and some of the accounts have still not been transferred.

My solicitor has sent over the probate to Alliance & Leicester and after me chasing – they said they did not receive the documents, but after my Solicitor phoned to complain they miraculously found them. They have however not passed this onto the Probate & Trust team and when I call the team I was told it is my responsibility to contact the team who received the probate in the first instance…but oh what do you know, no telephone number on the correspondence, so you have to type up a letter and fax it to them….to which I have had zero response.

I would like to add at this point, that at the same time as sending the documents to Alliance & Leicester we sent them to Nationwide and within less than a week the accounts were closed and transferred into my mum’s name. The service I have received from Nationwide has been superb. Just what you would expect – and I thank them.

Some of the other problems I have experienced are: Accounts being cancelled in error, Direct Debit Mandates cancelled, Debit and Credit Cards cancelled that were in joint names, losing legal documents, correspondence still being sent in my fathers name.

I cannot begin to tell you how much time I have spent speaking to this bank and I am still no further forward and have no faith whatsoever in their ability to get this resolved. As soon as I the accounts are transferred, whenever that may be, I will be closing them and transferring the money to a bank that does want to offer good Customer Service.

I have been told that I should be going through the grieving process for my dad, but this is impossible until such time as I have been able to sort out what should be a simple process.

I would like to add that at no point has anyone with Alliance & Leicester offered their condolences or shown one bit of understanding as to what families have to go through during what is the most emotional time in anyone’s lives.

Is this how they treat their customers fairly? – Thank goodness I am not a customer !

Written by Sarah Johnson

Sarah’s Profile

Concept Financial Planning Ltd

Why make a Will?

Is this one of the tasks that is always something to do next week or you get a free moment? We all know that next week never arrives and as for a free moment !

Benjamin Franklin (1706-90) said ‘ In this world nothing can be said to be certain, except death and taxes’

So why is it important to make a Will or regulary review one?
It is the only way you can determine who you want your estate to go to. If you have minor children, you can indicate in a Will who you would like to look after them should you die. This is particularly important where a relationship has broken up and the relationship between the individual and former partners is not good.
If your circumstances change it is important to make sure that you Will reflects your new circumstances.
Making a Will can mean a different inheritance tax IHT treatment of your estate or a change in the way that assets are assessed for Means Tested purposes should you need long term care.

Writing a Will is fundamental to the financial planning process because you are able to guide how your wealth is passed on down generations should you wish.

What happens if I do not make a Will?
You will die intestate. The rules of intestacy are different in different parts of the UK so it is important to keep up to date on the current position as this can change. The rules may mean that the people you want to inherit from you don’t or in a different proportion from want you would ideally like.

Who can make a Will?
Everyone aged 18 or over (12 in Scotland) or a serving member of the armed forcescan make a Will if they are of sound mind.
Even people who are deemed not to be of sound mind can make a Will or codicil to an existing Will if approved by the Court of Protection.

Do I have to use a solicitor to draft a Will?
You do not have to use a solicitor but I would strongly advise that you do so or at the very least use an individual who specialises in drafting Wills. This is especially true if your Will is complex. Sorting out mistakes after you have died may cause huge problems for your executors/personal representatives

TOP TIPS
If you don’t have a Will, make sure you know what will happen to your estate if you die without making one.

Before making a Will, think about what you want to happen to your estate.

Before making a Will yourself, think about taking advice from a solicitor or professional Will writer

Don’t try and change a Will by writing on the original

Make sure your chosen executors are happy to act in that capacity. Make sure they know where the Will is kept and if there are any special arrangements you want them to carry out quickly on your death such as funeral arrangements and organ donations. Time may be of the essence.